Why Some People Outlive Their Term Policy – And What to Do Next?

Term Insurance Explained

A term life insurance policy provides financial security to the family/ nominee during policy tenure. In case the life assured passes away during the tenure of the policy, the nominee receives the death benefits. Being a pure life insurance policy, a term policy typically does not offer any maturity or survival benefit. This is also the reason why term insurance is among the most affordable life insurance policies!

Tip: If you purchase a term return of premium (ROP) policy, you get back all the premiums paid as a survival benefit!

Reasons Why People Outlive Their Term Policy

Outliving the tenure of the policy means you have survived the policy tenure, as we read in the case of Ramesh Tripathy. There are various reasons why people may outlive the policy tenure. Some of them are listed below:

A Healthy Lifestyle

A healthy lifestyle is often the key to a longer life. There are many people who stick to a disciplined routine of regular exercise, a healthy diet, and a positive mind. A healthy and stress-free life is often a happy and long life. So, this is one strong reason why some people tend to outlive others.

Quality Healthcare

Health and life are unpredictable. In times of health crisis, it is crucial to have quality healthcare services. Those who are mindful of their health and keep a tab on it can often live a longer and healthier life. That's another reason why one may outlive the policy tenure.

A Shorter Policy Term

In some cases, people may purchase a term policy with a shorter policy term. Usually, the policy may range from 10-30 years. So, if someone purchases term insurance in their 30s for 15 years, the policy will expire when they are just 45 years old. So, it is only practical to choose a tenure that at least passes the prime years of your life.

Should You Buy Another Life Insurance?

Outliving your policy tenure simply means you have survived the risks of your life. Usually, when people are approaching retirement, major financial risks of their life have passed, like their children's education, buying a house, etc. However, that may not be the case with everyone.

So, the question is, is another life insurance worth it? Let's discuss when you can consider buying more:

You Wish to Leave a Legacy

Even if you don't have any major financial responsibilities left in life, you can purchase life insurance in the form of endowment, whole life, ULIPs, etc. These plans let you leave a legacy behind for your family and loved ones. The funds from a life insurance policy can be utilised by your loved ones to fulfil their financial needs.

You Have an Ongoing Loan/ Liabilities

In case your term insurance has expired, but you still have some dependent members or an active loan, purchasing another life insurance policy makes sense. A financial crisis, in any age, can be stressful. If you have a loan going on, having a life insurance policy gives you peace of mind. It protects your family from unforeseen financial crises.

Did you know, under the Married Women's Property Act (MWPA), you can ensure the death benefit of your life insurance goes only to your wife and no one else, not even creditors, banks, or relatives?

You Want a Regular Income for your Family

Certain life Insurance policies also provide a savings/investment component; some examples include endowment plans, unit-linked insurance plans (ULIPs), etc. If you are looking for a financial cushion for yourself or your family in the later phase of your life, purchasing another life insurance policy can be a good idea. Go through the various options to choose the most suitable one.

End coverages

The purpose of a life insurance policy, like term insurance, is to guarantee financial coverage for your family in your absence. A policy serves its purpose even if you outlive the policy without any benefit. The very idea of term insurance is protection throughout the tenure. However, if you outlive the policy tenure and still want to continue with this much-needed peace of mind, purchasing another life insurance policy can definitely be worth it.

At Jio Insurance Broking, you don't have to settle for the least. You may compare various life insurance policies to choose the most suitable one. Connect with us today!