Convertible Term Life Insurance – Easy Conversion Options

Convertible term life insurance allows active policyholders to extend or convert to permanent coverage with no questions asked.

If you have an active convertible term insurance policy you have taken a major step towards securing your family’s future.

However, most people outlive their initial term coverage without realizing that the duration of coverage could have been extended by exercising a life insurance conversion option.

Term insurance is often thought to be a temporary policy covering policyholders for 10, 20 or even 30 years.

However, it doesn’t have to stay that way. This is because many policies are considered convertible term life insurance which can be exchanged for longer running permanent life insurance.

Permanent life insurance comes in many varieties but can be classified into two basic categories: Universal Life and Whole Life.

Convertible Term Life Insurance

Should you consider a Life Insurance Conversion?

First, you will need to find the answer to few common questions:

  • Is my policy considered convertible life insurance?  Most term life policies are  convertible and renewable life insurance, but some do not have a conversion feature.
  • What’s the deadline? Many convertible term life insurance policies will allow you convert until the end of the term, but some companies only let you convert up to a specified age, often until ages 70 or age 75.
  • What are your convertible term life insurance options?  The options which are available will vary depending on the issuing company and the quality of its product portfolio to which you can convert your term life policy.
  • What are your options if you don’t convert? Once a life insurance policy reaches the end of its term, the premium will dramatically go up in cost.

If your policy is indeed convertible term life insurance and is also within the designated time period required, your in luck!

Not to mention, you will not have to answer questions about your health or take a new medical exam.

The policy will be issued at the same rate class as when you initially purchased your term life policy. So, if you have developed any health problems during the policy term your rate class will not change with your new permanent policy.

Life insurance companies will simply maintain your original health rating and use your current age to establish the cost of your new policy.  

A life insurance conversion also gives a current policyholder the privilege to convert a portion or the entire amount of term coverage.

Since, term life insurance is cheaper compared to permanent insurance many people elect to convert coverage in smaller face amounts then their original policy. The newly converted policy can be designed to extend the duration of your policy to different ages (i.e. age 90, 95, or 100).

Typically, conversion options are usually more expensive then term insurance at younger ages, but as people get into their 50’s and 60’s the pricing spread lessens.

convertible term life insurance

We can help you Convert your Term Policy

We represent most life insurance companies and can work on your behalf with your existing life insurance company.

If you have future needs which will require continued life insurance coverage, Affordable Life USA can explore if a life insurance conversion is financially viable for you.


Convertible Term Life Insurance Companies

It’s important that you work with an agent who is experienced in converting life insurance policies.  If you can not locate the agent who originally sold you your policy. we would be happy to assist you.

After, gathering few simple details about your existing policy, we will design a new plan illustration which meets your needs and budget.

Not to mention, we will also compare your life insurance conversion options with policies currently available in the open marketplace.

People in decent health can also  elect to replace their existing term coverage with a new term life, hybrid universal life, or guaranteed universal life (GUL)  policy. Many new products and improved life expectancy have created a highly competitive marketplace.

A market search may not be viable if your overall health has eroded causing much higher premiums or a declination.

This can be determined by discussing your needs and health with an experienced agent familiar with the impaired risk market.

If you can not obtain a new policy, electing a life insurance conversion is even more important because of a limited life expectancy and unavailable alternatives with new policies.

After all, you really do not want your coverage to end just when your family may need the life insurance proceeds. Essentially, the insurance policy offers a good return on investment for your family because benefits can be extended at a reasonable cost.

As you can see, it is essential to work with a reputable adviser familiar with the open market and conversion protocol. If you need assistance evaluating your convertible term life insurance policy, please call us at 1-877-249-1358.

Eric Van Haaften, LUTCF is the president of Affordable Life USA. We are a nationally licensed life insurance agency focused on finding our clients custom planning solutions at excellent prices. 1-877-249-1358. eric@affordablelifeusa.com