What happens when term insurance expires without you making a claim?

Once the life insured outlives the term insurance policy period there will be no insurance coverage. Under certain term insurance plans if the policy holder opts for return of premium (RoP) the total premium paid could be returned after the end of the policy.

Before the expiry of the term insurance plan you should renew it for continued protection.

As the name suggests, a term insurance policy promises to offer security for a certain period of time. During the policy period, the policy holder’s family is eligible to receive a life cover in case of his/her unfortunate demise. Like other insurance plans, term insurance is also purchased by paying a fixed amount at regular intervals, called premiums. While these plans are good options for those who have more family liabilities, it is also important to keep certain things in mind such as the expiry of the insurance plan.

It’s important to note that if a term insurance buyer outlives the policy period, or if the plan expires, there will be no insurance coverage.

Also, the family will not receive the financial security that they would have in case the plan was active. While some people just let the coverage expire and go without life insurance, there are also many insurance buyers who still need the financial protection.

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Here's how you can ensure the financial protection of your family in case of expiry of your term insurance plan.

What happens when a term plan expires?

Based on the coverage that a person purchases, they might face any of the following consequences in case they outlive the term insurance policy period.

1. The term plan expires without the maturity value and the benefit of life coverage also comes to an end.

2. As per certain term insurance plans, the life insured may receive an amount equivalent to the full premium if he had opted for the return of premium (RoP) option.

What to do to avoid expiry of the term insurance plan?

One can do the following things in case your plan is about to expire:

1: Extend your current policy: One of the benefits that insurance companies offer is the option to extend term life policies including the coverage and the current death benefit, without having to go through a new underwriting process and getting another medical exam.

2: Convert your plan to a permanent one: Policy providers also offer the option to allow insurance holders to convert their policy into a permanent one, without having to provide evidence of insurability. However, one must begin this process at least one year before the policy's stated conversion deadline.

3: Buy a different life insurance policy: In case your financial goals have changed and your family has also become bigger, it might be the right time to buy a new policy with better returns. However, the earlier you begin, the more prepared you will be to face the difficulties.

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