How long should the term run?

Start from the payoff date

Take the remaining term from your statement, not the original loan term. A thirty-year loan taken out four years ago needs twenty-six years of coverage, and rounding up to thirty costs little.

Then check the rest of the picture

If children will be dependent past the payoff date, or a partner would rely on your income beyond it, the coverage should run to the later date rather than the loan's.

Coverage that ends the month the mortgage clears leaves a household with no protection at all from that point, which is rarely what anyone intended.

Refinancing is the complication

Refinancing typically resets the clock. A term chosen to match the original payoff can end years before the new one.

This is a strong argument for a policy you own that isn't tied to a specific loan, and for choosing a term with headroom rather than one that fits exactly.

Common mismatches

• A twenty-year policy against a thirty-year loan
• A term matching the original loan after refinancing extended it
• Coverage ending at the payoff date while children are still dependent
• An adjustable-rate loan where payments could rise and extend the effective burden
• A policy tied to a lender that ends when the loan is sold or refinanced

Build in the hedge

A conversion privilege lets you move to permanent coverage without proving your health again, which is the remedy if the need outlasts the term.

It usually expires well before the term does. Note that date at purchase.