renewable term life insurance

Definition

A term life insurance policy that allows the policyholder to renew the policy (typically at a higher premium rate) after the policy has matured. For instance, if an individual has a term life insurance policy that is scheduled to mature in 2020, he/she is given the ability to renew the policy at that time instead of having to open up another policy. In most cases, the monthly premium escalates to an unfavorable rate, prompting the policyholder to purchase another policy.

Use this term in a sentence

The renewable term life insurance was set to mature , and the policy holder may want to continue having the coverage.

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I currently carry renewable term life insurance to protect my family in the event of my death however the premiums have escalated significantly as I continue to age.

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One reason you would not want to purchase a renewable term life insurance policy is because you would be forced to pay an extremely high premium at the renewal time than you would possibly be able to afford.

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