What happens when my term life insurance policy expires?

When your term policy expires, coverage ends. No benefit is paid if you survive the full term—that is by design. At expiration, you have several options depending on how your policy was structured and your current health.

Most term policies include a renewal option that extends coverage on a year-by-year basis without new underwriting. The catch: renewal premiums are recalculated based on your attained age and can be dramatically higher. A policy that cost $50 per month at age 35 may cost $400 or more per month upon renewal at 65 (illustrative; actual premiums vary).

Conversion is generally the more valuable option if available. A conversion privilege lets you switch part or all of your term coverage to a permanent policy without a new medical exam, locking in insurability regardless of health changes. Conversion deadlines vary by policy—often you must convert before age 65 or 70, or within a set number of years from issue.

If neither option fits, you can apply for a new policy, but you'll be underwritten at your current age and health status. Planning your exit strategy before your term expires is important.