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What Happens If I Don’t Die While My Policy Is in Force?

Throughout the duration of your term life insurance policy, you’ll pay monthly premiums to keep your coverage in effect. A common question among insured individuals is:

What happens to my premiums when the policy expires?

At the end of your term, coverage will end and your payments to the insurance company are complete. If you outlive your term life insurance policy, the funds are forfeit. The premiums from individuals who don’t die while their policies are in force ultimately support the generous payouts that insurance companies can pay to those who do.

Where does my money go for my term life insurance policy?

Everyone who is paying life insurance premiums is essentially putting all their money in a large metaphorical bucket managed by the life insurance carrier.

When the company needs to pay out a death benefit, they take the pay out amount from that bucket. Your money helps another family in need of financial support because of a lost loved one. And, if you die during the term of your policy, the company reaches into that bucket that everyone is paying into and gives that money to your beneficiaries.

The point of term life insurance is to ensure your family is protected by replacing your income if something unexpected happens to you. If the insurance company doesn’t pay out the death benefit that means you’re still alive and shouldn’t have too much to complain about.

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What if I want to continue being covered with a term life policy?

If your term life insurance policy is ending and you want to continue to make sure your family is protected, you can convert the policy into a permanent one.

Most term insurance policies have a

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