Rethinking Term Life: Utilizing the Renewable and Convertible Features

While our focus is Permanent Life, many policyholders start with term insurance. Understanding the **renewable** and **convertible** features of term policies is the bridge between temporary protection and permanent financial security.

The Renewal Feature

At the end of the initial term period (e.g., 20 years), most term policies are renewable without a medical exam. However, the premium will increase dramatically to reflect the insured’s older age and higher risk. Renewing is typically very expensive and only suitable for temporary needs.

The Conversion Feature (Bridge to Permanent)

The conversion privilege allows the policyholder to switch to a Permanent Life policy (like Whole Life) before the conversion deadline. This is often the best path to long-term security because:

• Guaranteed Health Rating: Conversion is based on the original (usually younger and healthier) health class.
• No Exam: No new medical exam is required, making it ideal if the insured’s health has declined.

Disclaimer: This content is for informational purposes only and is not financial or legal advice. Always convert coverage *before* the conversion deadline if permanent protection is desired.