Looking for opinions on the 2 alternatives I have now (background - my home equity line of credit HELOC 10-year draw period ends in November. I never used it; it was just a safety net, and I would like to continue having that safety net. Current HELOC rate is 3.25%)

1. Straightforward way - Get new HELOC from same lender (they will not just extend the draw period). They offer 0 closing costs but only 5 year draw period at higher rate, probably 5%. Again, I would plan never to use it, just a safety net. (Or I could look for a HELOC from a different lender that might offer better terms.)

Drawbacks: hassle of a closing; risk of lender reducing the credit limit during the draw period (even though they never did so during my past 10 years)

2. Maybe a bit odd, but - Use the present HELOC before it expires in November (e.g. take out $100,000 of the $2000,000 HELOC limit) and put that money in the bank (actually cash value fund of my life insurance which pays 4% tax-deferred) as my safety net, making regular payments on the HELOC debt over the next 20 year payment period.

Drawbacks: impact to my credit rating from having a $100,000 HELOC/2nd-mortgage debt, which might block me from getting a new HELOC if this option 2 turns out to be a bad idea

Opinions? Thanks.