When Does Life Insurance Mature?

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Understanding Life Insurance Maturity

When Does Life Insurance Mature?

Life insurance matures when the policy term ends or when the insured person reaches a specified age, usually 95 or 100. At this point, the policy’s cash value or death benefit is paid to the policyholder or beneficiaries.

Outcomes of a Maturing Life Insurance Policy

  1. Payout of Cash Value:
  2. Payout of Death Benefit:
    • If the insured person is still alive when the policy matures, the death benefit may be paid to the policyholder as a living benefit, providing financial security and flexibility.
  3. Policy Continuation:
    • Some policies allow continuation beyond the maturity date, converting into a paid-up policy with no further premiums due but with a reduced death benefit. This option provides ongoing coverage without the need for additional payments.

Options for Policyholders Upon Maturity

  1. Receive the Cash Value:
    • Policyholders can opt to receive the cash value as a lump sum, which may be subject to taxes on the portion that exceeds premiums paid. This option provides immediate liquidity for various needs.
  2. Convert to an Annuity:
    • Some insurers allow the conversion of the cash value into an annuity, providing a steady income stream for the policyholder. This can be an excellent option for those seeking a reliable source of retirement income.
  3. Renew the Policy:
    • Certain policies offer renewal options, allowing continued coverage with adjusted terms and possibly higher premiums. This option ensures ongoing protection for the policyholder and their loved ones.

Tax Implications

  • The cash value received upon maturity may be taxable if it exceeds the total amount of premiums paid into the policy. Consulting with a tax professional is essential to understanding potential liabilities and making informed decisions.

What If the Policyholder Passes Away Before Maturity?

  • If the insured person dies before the policy matures, the death benefit is paid to the designated beneficiaries, typically tax-free. This provides financial security to the policyholder’s loved ones.
What Happens When Life Insurance Matures

How We Can Help

At The Annuity Expert, we understand that navigating the complexities of a maturing life insurance policy can be overwhelming. You may be unsure of the best course of action to maximize your benefits and secure your financial future. Our goal is to provide you with expert guidance and personalized solutions to ensure you make the most of your policy.

For 15 years, we have been helping individuals like you make informed decisions about their life insurance and annuity options. As an experienced insurance agency, annuity broker, and retirement planner, we believe in finding the best solutions at the lowest costs. We stand for empowering our clients with knowledge and options that fit their unique needs and preferences.

We recognize that the main problem you face is the uncertainty surrounding the maturity of your life insurance policy. You may feel anxious about making the wrong decision, worried about tax implications, or unsure of how to secure a steady income stream for retirement. These emotions are valid; we are here to provide clarity and confidence in your choices.

Life Insurance Maturity Date

What We Recommend

Step 1: Initial Consultation

  • What Happens: During our initial consultation, we will review your life insurance policy and your financial goals.
  • Main Benefit: Gain a clear understanding of your options and the potential outcomes of each.

Step 2: Customized Plan Development

  • What Happens: Based on your unique situation, we will develop a customized plan that outlines the best course of action for your maturing policy.
  • Main Benefit: Receive a tailored strategy that maximizes your benefits and aligns with your financial objectives.

Step 3: Implementation and Ongoing Support

  • What Happens: We will help you implement the chosen strategy and provide ongoing support to ensure your plan remains effective and relevant.
  • Main Benefit: Enjoy peace of mind knowing you have a trusted partner managing your policy and financial future.

Features We Provide and Their Benefits:

  • Expert Guidance: Professional advice tailored to your needs ensures you make informed decisions.
  • Personalized Plans: Customized strategies that align with your financial goals and circumstances.
  • Ongoing Support: Continuous assistance to adapt your plan as needed, providing long-term security and peace of mind.

Common Objections and Counterarguments:

  • Objection: “I can handle this on my own.”
    • Counterargument: While it’s possible to navigate on your own, our expertise ensures you maximize your benefits and avoid costly mistakes.
  • Objection: “I’m worried about the cost.”
    • Counterargument: Our services are designed to save you money in the long run by finding the best solutions at the lowest costs.
  • Negative Consequences: Without expert guidance, you risk making uninformed decisions that could lead to financial loss, missed opportunities, and unnecessary tax liabilities.
  • Positive Outcomes: Working with us ensures you receive maximum benefits, tailored strategies, and peace of mind, knowing your financial future is secure.

Contact us for free advice or a quote today, and take the first step towards maximizing the benefits of your maturing life insurance policy.

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Frequently Asked Questions

What is the maturity date of a life insurance policy?

The maturity date of a life insurance policy is the date when the coverage terminates, and the policy value is paid out to the policy owner.

What is the difference between term and permanent life insurance policies?

Term life insurance policies do not have a maturity date and expire at the end of the selected term, while permanent life insurance policies have maturity dates and are designed to last until the death of the insured.

What happens when a permanent life insurance policy matures?

When a permanent life insurance policy matures, its value is paid to the policy owner, usually in the form of the cash value or the face amount of the policy.

Can a term life insurance policy mature?

No, term life insurance policies do not have a maturity date but can expire or be renewed for another term.

What options do policyholders have when their life insurance policy matures?

When their life insurance policy matures, policyholders have several options, including renewing it, converting it to a different type of life insurance policy, or receiving a return of premium payments.

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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