Term life conversions Are term life conversions an option only for the healthy? The answer is, “No,” reports Cincinnati.com. In fact, it can be a very beneficial option for those in bad health.
Certain term life insurance policies offer a guaranteed conversion rider which allows a policyholder to purchase a new cash-value policy at the same insurance rates of healthy individuals of the policyholder’s same sex and age, the Cincinnati.com report says.
“This provision can be especially beneficial to policyholders with medical problems, as they will not be forced to undergo a physical examination to gain coverage,” the website reports. However, most conversion policies enforce a maximum age at which a policyholder is allowed to convert, usually 70 years old, according to Cincinnati.com.
Term life insurance policy holders interested in this option should consult with their insurance company to make sure they offer this service.
Most Americans understand the functions of a term life insurance policy, but many may not know how it can save them money when they convert their policy to a plan that provides coverage for a longer period of time with term life conversions.
A standard term life insurance policy provides coverage for a set period of time, usually between one and 30 years, and only pays if a death occurs during the policy period, according to the Insurance Information Institute.