What does "non-renewable" mean in the context of term life insurance?

The term "non-renewable" in the context of term life insurance specifically refers to a policy that cannot be renewed after the term expires without undergoing a new underwriting process. This means that once the initial term of coverage concludes, the insurer will not extend the coverage on the same terms. Instead, the policyholder would need to apply anew, and the insurer will evaluate the application based on the current health status and other factors at that time.

This situation can be significant for policyholders since it may lead to higher premiums or even rejection based on changes in health or age since the original policy was issued. Understanding this concept is vital because it highlights the structured limitations and considerations involved in term life insurance policies and how they differ from policies that offer the option to renew without new underwriting.