Renewable term insurance may have a provision called reentry, which means that the insurance company can ask you to undergo a medical exam before it will renew your policy after the term expires. If your health isn’t good and the reentry clause permits it, the company can cancel your insurance. In return, you can purchase renewed insurance at a reduced rate — basically, the rate a person who just passed an exam would pay.
The gamble here is that you will remain healthy. Then again, if the re-entry clause doesn’t permit the company to cancel your insurance but does allow it to charge you higher premiums, you’re gambling on money, not your health. Some re-entry policies spell out the maximum premium that can be charged. If you’re gambling, you ought to know how much you’re gambling on.
When purchasing re-entry term insurance, make sure that you keep the right to renew your insurance even if you don’t pass a medical exam. Although may have to pay higher premiums, at least the company won’t be able to cancel your policy.
The gamble here is that you will remain healthy. Then again, if the re-entry clause doesn’t permit the company to cancel your insurance but does allow it to charge you higher premiums, you’re gambling on money, not your health. Some re-entry policies spell out the maximum premium that can be charged. If you’re gambling, you ought to know how much you’re gambling on.
When purchasing re-entry term insurance, make sure that you keep the right to renew your insurance even if you don’t pass a medical exam. Although may have to pay higher premiums, at least the company won’t be able to cancel your policy.
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