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Term life insurance renewal

Simple Insights®

Term life options FAQs

Your term life policy premium is about to convert to annually renewable. Now what?

When you purchased your policy, the premium was for a specific amount of time – usually 10, 20 or 30 years. If you take no action at the end of this time, or term, your policy automatically changes over to an annual renewable policy.

This means that your policy premiums automatically renew each year, and you can expect a premium increase every year.

When your current term premium changes over, you have choices:

1) Convert your current term life insurance policy to permanent coverage, such as whole life or universal life.

  • Provides lifelong protection (as long as your premiums are paid on time).
  • Level premium for the coverage amount.
  • Higher initial premiums than a term life policy.
  • Builds value that you can borrow against.1
  • The process is simple - just answer a few questions and sign your name.

2) Apply for a new term policy.

  • Select 10, 20 or 30 years of coverage.
  • Lower initial premium than a permanent life policy.
  • Does not build cash value.

3) Do nothing and extend your current policy. If you take no action, your current policy automatically renews for one year. This may not be your most affordable option.

Before you choose an option, sit down with your State Farm® agent. Together you can talk about what’s right for your family and budget.

Any day before your premium changes. You should have received notification of your policy renewal date by email or letter. If you would like to confirm this policy renewal date, please contact your State Farm agent.

Your policy premium automatically becomes annually renewable. This will likely result in a premium increase, and you can expect increases every year. This may not be your most affordable option.

First, explore your options. We’ve made many resources available here on®.

Then be sure to contact your State Farm agent. After the two of you discuss your personal life insurance needs, your agent will help you adapt and adjust your coverage.

State Farm® life insurance provides a death benefit that can help you:

  • Maintain your family’s standard of living
  • Pay bills – such as home, car and tuition
  • Permanent life insurance like whole life or universal life build cash value that you can use during your lifetime 1

As you consider your life insurance needs, why not check out our Simple Insights? This article helps you understand how much insurance you may need, and why.

That’s a highly individual decision based on your responsibilities and your priorities. To help you sharpen your focus on your life insurance needs, we created our Term Life Insurance Renewals questionnaire. After you complete this exercise, a State Farm agent can explain your options in greater detail and help you select the one that best aligns with your life and your budget.

Yes. The cost of insurance is determined by a number of factors, including your age. Since you’re 10, 20 or 30 years older than you were when you purchased your current policy, you can expect your premium payment to rise. If you choose to purchase another term policy for 10, 20 or 30 more years of coverage, your premium will go up again at the end of that term.

One benefit of whole life insurance is lifetime level premiums. This means that your premium payment will be the same for the rest of your life (as long as your policy is in force).

Your life has likely changed in the years since you purchased your current policy. For example, you may have added to your family since you bought that policy, so you might want more death benefit coverage today to anticipate tuition payments. On the other hand, the child who was in Kindergarten 20 years ago may be out on their own now, so you may decide you need less coverage.

Perhaps you have moved into a larger home with a bigger mortgage or have downsized into a smaller home for your retirement years. Your policy can be designed to provide the right level of protection you need to fit your current lifestyle. Your finances should be a consideration, too. Life insurance can help replace lost income due to premature death for a period of time. If your salary has increased over time, perhaps you should increase your coverage accordingly.

As you consider your life insurance needs, why not check out our Simple Insights? This article helps you understand how much insurance you may need, and why.


We hope this answers your questions about the upcoming changes to your term life insurance policy. If you would like more detail, please contact your State Farm agent.

Life lens

Our seven-question Term Life Insurance Renewal questionnaire is a good place to start looking at some key factors that can impact coverage, costs and your life insurance decision for the future.

Click here to download form

1 Permanent life insurance develops cash value that can be borrowed. Policy loans accrue interest and unpaid policy loans and interest will reduce the death benefit and cash value of the policy. The amount of cash value available will generally depend on the type of permanent policy purchased, the amount of coverage purchased, paid premiums, the length of time the policy has been in force and any outstanding policy loans. There may be tax consequences associated with policy loans. State Farm agents do not provide tax or legal advice. Please consult your tax or legal advisor regarding your specific circumstance.

Each State Farm insurer has sole financial responsibility for its own products.

State Farm Life Insurance Company (Not licensed in MA, NY or WI)
State Farm Life and Accident Assurance Company (Licensed in NY and WI)
Bloomington, IL