In regard to non-forfeiture values, what does "extended term insurance" refer to?

Extended term insurance refers to a feature of a life insurance policy that allows the insured to maintain a death benefit for a specified period without the need for ongoing premium payments after a policy has lapsed due to non-payment. This option is particularly relevant in the context of non-forfeiture values, which are designed to provide some benefits to the policyholder even if they can no longer afford to pay the premiums.

When a policyholder stops paying premiums, instead of losing all benefits, extended term insurance enables them to convert the cash value of the policy into temporary insurance coverage for a limited term. This means the insured can still have some protection in place during the term, although it will eventually expire if not renewed.

This option is advantageous because it maximizes the value of the policyholder's previous investment in the life insurance policy, ensuring that they can still provide coverage for their beneficiaries for a duration without needing to make further payments.