Term of term life expiring

IMO, reassess your needs and get another term policy.

Just find another term policy, that’s always the best bet.

Most insurance companies will require you to be 7-10 years free of cancer. The conversion is probably your best bet now IF you still feel you need coverage. Then in a few years get another term policy if you feel you need it.

Also- there may be companies that have shorter periods- like maybe five years.Im not aware of any but I’m sure there are some. Viewing the conversion as a short term stop gap until you can apply for a term policy in another few years may be your best option.

Your options imho-
Cancel policy
Renew same policy ( super expensive)
Convert policy into whole life
Get new term policy later when able to qualify

This is what I do for a living.

You're in your late 50s now -- do you even have a need for that much coverage now? Probably not. Most people, by the time they are in their late 50's and older, don't need nearly as much life insurance as they needed when they were younger. If you're in that boat, I would highly advise you just let the term expire and get a much cheaper, lower face amount whole life policy to take care of your final expenses when you die. You don't want to go without any life insurance in force. Since you are over 50, you qualify for what's called a final expense whole life policy -- these are usually $35,000 or less of coverage. It is permanent and, although will likely seem very expensive compared to your term policy cost, will never expire.

The reason you don't want to get a new term policy at your age is because you will likely have to go through full underwriting and that will catch any and every little thing you've been diagnosed with, prescribed medication for, and advised about by a member of the medical profession. The insurance company will use that info to rate the shite out of your term policy. So you'll likely be paying a lot more for way more coverage than you really need at this stage of your life.

If you convert the term to whole life, you may have to go through full underwriting or you may not have to - depends on what company it is. But you'll likely have a minimum amount that you can convert to whole life, which will still make it MUCH more expensive than you really want to pay at this point in your life.

My best advice is, if you don't have a need for a large amount of coverage anymore, to get a final expense whole life policy so that your family will have tax-free funds to bury you with and won't have to wait for your estate to be settled before being able to access funds in your accounts to pay for it.


Personally, my wife and I each have almost $1 million in term coverage until we're 60. We also have $100,000 of whole life coverage that we purchased when we were younger. When our term runs out, we're going to let it go because we won't need that by then anyway (kids will be grown, house paid off, etc.) and we will each have our whole life policy to pay for our final expenses and still have a little left for the other to invest/save/spoil grandkids with.

Have $ 200,000 whole life already, so I don't guess anything additional will be necessary. Thanks for the advice

If that's the case, let the term expire.

Whole life is not useful for people who are responsible and can manage money. If you take the savings from a whole life policy to a term and invest it yourself you will make more money in the long run. If you need someone to make you save money then buy the whole life policy.

quote:

---

You don't buy a whole life policy because of the cash value aspect

---

quote:

---

Again -- don't buy a whole life policy because of the cash value component. You will lose 99% of the time if that's your reason for buying a whole life insurance policy.

---

This cant be stated enough.
Unfortunately, too many sales agents use the cash value component as a selling feature.

The original purpose of cash value in a whole life policy is that it makes the cost of insurance lower.

You buy a $100k whole life policy at 35 years old , the insurance company has $100,000 at risk for a young person.

At age 60, the whole life policy may have a $50,000 cash value. The net amount at risk for the insurance company is only $50,000 on the $100,000 benefit. This keeps the cost of the policy down as the mortality rate of a 60 year old is very different than a 35 year old.

At age 80, the cash value may be $75,000. The net amount of insurance at risk for the company is $25,000 on a $100,000 benefit. The mortality rate for an 80 year old is extremely high.

The entire original purpose of whole life was to make a permanent protection affordable.

quote:

---

what you’re saying here but when you die, you do not get the death benefit and the cash value.

---

Correct. There are different types if permanent policies (death benefits can increase on a whole life policy). But the insurance company pays the death benefit upon receipt of a death certificate.
The amount at risk to the insurance company is the death benefit minus the cash in the policy (whole life policies are expensive. But they would be more expensive without this component reducing the insurance risk at the highest mortality rates).

quote:

---

The best thing anyone can do is buy a $100k or more whole life policy for their children when they are born.

---

I dont like blanket statements like this. You could invest the premiums of a $100,000 into an index fund and come out way better 80 years down the road.
Or you can buy $100,000 of permanent insurance on yourself for each child and let them invest in themselves when you die (start a business or payoff commercial debt if they already have started a business).
Life insurance helps the beneficiaries. Buying a sizeable policy for a kid is more likely going to benefit the kid's grandchildren if they live to average life expectancy.

If you sell life insurance, I question your ability to understand the product and how actuarials/pricing works.

If you have read up on life insurance, you are completely missing the point.

If a life insurance company has a $100,000 death benefit with a $50,000 cash value, the benefit paid to the beneficiary is $100,000 (this is funded by the $50,000 cash value and an additional $50,000 net insurance at risk).
What type of policy has more cost to a life insurance company?
A $100,000 payout with $50,000 cash value or a $100,000 payout with $0 cash value.

102 level question:
What type of policy has more cost to a life insurance company?
A $100,000 payout with $25,000 cash value or a $100,000 payout with $50,000 cash value?

Net insurance is the actual amount of insurance being supplied to the customer. Net insurance is the actual amount of insurance which needs to be calculated by the actuarial.