Some people make the mistake of purchasing a term life insurance policy with a limited term length. At the time of purchase, the policyholder is under the impression that the coverage is only needed for the length of the policy. When the term length expires, the policy is declared invalid. So, all the money you invested in the policy is flushed down the toilet. Those policyholders have a solution, whether they are aware of it or not. What is that solution? Find out by reading the article below.
Term Life Insurance – Renewable Or Not?
Term life insurance policies are set up like a contract, which is subject to expire. When you choose a term length for your policy, you agree to make the monthly premium until the expiration date. The insurance company, on the other hand, agrees to cover the death benefits until the policy expires. If for some reason, you fail to pay the premiums, the policy will expire immediately. So, the insurer is not required to pay the death benefits from that point on.
To protect your investment, you have the option of renewing the policy before the contract expires. However, there is a downside that you need to be aware of when it comes to renewing a term life insurance policy. That downside is a limited renewal term length. For example, a 5-year policy can only be renewed for an additional five years.
Can The Policy Be Renewed Over And Over Again?
Term life insurance policies can be renewed as many times as you feel necessary. However, the policy needs to be renewed before the expiration date. With that said, some insurance companies may be willing to work with policyholders who find themselves in similar situations. If for some reason, you forget to renew your policy before the deadline, contact your insurer as soon as detected.
Get in touch
I am always a call away. If you are looking into life insurance coverage for the very first time or would like to discuss your existing policies, I would be glad to be your Markham life insurance advisor.
My contact information can be found here.