Convertible insurance is a type of life insurance that allows the policyholder to change a term policy into a whole or universal policy without going through the health qualification process again.

How does convertible term life insurance differ from renewable term life insurance?

While a renewable term life insurance policy allows you to simply extend your current coverage, having a convertible term life insurance policy means that, at any point during your term or before your 70th birthday (whichever comes first), a policyholder may convert term life coverage to whole life coverage.

What does renewable and convertible life insurance mean?

June 14, 2021. Renewable and convertible life insurance policies are both types of term life insurance. Renewing a policy increases your coverage for another term while converting it will turn it into a whole life insurance policy. Policies can be just renewable, just convertible, or both renewable and convertible.

How does a convertible term life insurance policy work?

With a convertible term policy, you can simply convert to a permanent life insurance policy and have coverage for the rest of your life, even if you have become “uninsurable” since getting your first policy.

Which is more expensive permanent or convertible life insurance?

Permanent policies are typically more expensive than term policies because they have an investment component and offer lifelong protection. But it might still be cheaper to convert than apply for a new permanent policy when your term ends. You can use your original age when converting.

Can a term life insurance policy be converted to a permanent policy?

Providers may limit which permanent products you can convert your term life insurance policy into, but the majority allow you to convert to any of their permanent policies. You will still pay higher premiums than when you had a term life policy.

What are term and universal life insurance policies?

To understand a convertible policy, you must first understand term and universal policies. “Term” life insurance is a policy that provides the insured person coverage for a certain period of time. On the other hand, a “whole” or “universal” policy is considered permanent, providing coverage for the entire life of the insured.