Should I Convert My Term Life Insurance Policy?

Most term life insurance policies have a provision where during a specified period of your policy, you can convert to a permanent policy without going through underwriting again.  Which means there is no medical exam and your rate class is the same as when you applied!  (HUGE)

While the vast majority of life insurance policies have the benefits attached to them, most applicants don’t’ understand the conversation ability and how they can use it. Depending on your situation, you could be wasting thousands of dollars if you don’t’ convert your term life insurance policy to a whole life plan.

A life insurance conversion is a great option in these situations:

Term Insurance That Is Expiring

Should I Convert My Life Insurance PoliccyIf your term insurance is expiring and you are looking to replace it with a permanent policy, a term conversion may be your best option.  The upside to this is there will be no medical exam and you’ll receive the life insurance health class you currently have.

For a lot of people, this can be a huge advantage for several reasons. Most people aren’t in as good as health as they were the first time that they applied for life insurance, which means that they will get a much lower rating class. Instead of putting put in the lower class, you’ll be able to convert and keep the same rating, which could save you hundreds of dollars on your life insurance.

Health Has Declined Since You Initially Purchased The Policy

In some cases, your less than perfect health could be more than just a poor diet and skipping the gym. You could have been diagnosed with a severe health complication since the last time that you applied for life insurance. Having a preexisting condition when you apply for coverage could drastically reduce your chances of getting coverage, it could also cause your monthly premiums to go through the roof.

If you’ve had some major health issues, check to see when your conversion option expires. Depending on your life insurance company, your conversion period may expire before your policy does (we can find out for you).  You may want to think about converting either the total face value or just a portion of it.   You’ll receive the same health class when you applied.

Needs Have Changed From A Temporary Risk To A Permanent Risk

Many people initially purchase term life insurance to cover a temporary need.

For example, they wanted the coverage until their mortgage is paid off or the kids are financially independent.  When their objective is met, many times their life insurance needs become more permanent.  They may want to protect their retirement income, debts, final expenses or just want to leave money for their spouse or children when they pass.  In this case, a term life insurance conversion could be the best decision.

Many consumers call us to find out what their conversion options are and many even ask us: “Should I convert my term life insurance policy?”  If they fall into any of the above categories, then the answer is almost always YES. Of course, everyone’s situation is different, but just about in every case, it’s an easy way to save some money. Additionally, it was save you time and trouble instead of having to go through the whole application process again.

The closer that you get to your insurance plan expiring, the better idea it is to review your application and see if it’s still the best option. There could be better and cheaper options on the market that weren’t there when you first bought the policy. Working with one of our independent agents can help you explore all of the options and determine which one fits your family’s need the best. Unlike traditional life insurance agents, our agents don’t only represent one single company. Instead, we represent many highly rated companies across the United States, which makes it easy to see if you have the best insurance available to you.

Not having adequate life insurance could be one of the most devastating things to happen to your family. On top of losing a loved one, they suddenly find themselves with thousands and thousands of dollars of debt and no many to pay for all of these bills. It can be one of the most emotionally and financially draining times of their lives, but a life insurance policy can prevent all of that.

Aside from deciding if you should convert your plan, you’ll also need to ensure that your coverage still fits your needs. Your finances and debts have probably drastically changed since the first time that you applied for life insurance. So take a minute and use the tips below to recalculate your correct coverage level.

The first is your debts. The primary purpose of your life insurance is to give your family members the money that they will need to pay off all of your unpaid debts and final expenses like your burial costs and funeral fees. Add up all of the expenses that they would be responsible for, like mortgages, student loans, burial costs, and any others and make sure that your coverage is large enough to pay for all of those.

The next factor to look at is your annual income and how many people rely on it. The secondary goal of your life insurance is to replace your salary if anything tragic were to happen to you. Your life insurance plan can give your family the money that they need to pay for essential expenses and get through the difficult time of losing a loved one without suffering financially or sacrificing their standard of living.

If you want to know more about conversion of policies, please feel free to contact us at any time. It’s our mission to ensure that you’re getting the perfect life insurance coverage for your family.

For more information about converting your term life insurance policy, please visit our Life Insurance Conversion page or call us at (888)430-7668.

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About Jeff Root

is the owner of He's an independent life insurance agent who has helped 1,000's of consumers purchase life insurance online and over the phone.

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