Why convert to a permanent life policy
What can you do to avoid paying higher premiums when your term policy ends? Most term policies come with a convertibility option, allowing you to migrate to a permanent life policy within a certain stipulated period. If you feel the need for life insurance coverage when your term life policy ceases, you should seriously consider the convertibility option. Since buying a fresh term or permanent life policy will attract high premiums, you will have to carefully plan ahead for the time your term policy will lapse.
As you age you become more stable financially. However, even though most of your obligations are taken care of, you still have to consider factors like possible ill health, hospitalization or expensive medication that may set you back financially. A permanent life insurance policy will help you to provide for your family, despite these expensive financial setbacks.
The importance of converting early
The most important factor in exercising the conversion option is to do it within the time frame specified in the policies. Some policies mention that you can exercise the conversion option no later than a certain age. If you always had a long-term plan of buying a permanent life policy, then do so at the earliest because as you age, you will attract higher premiums.
The procedure of converting from term life to permanent life
The procedure to convert is very simple. You will need to get in touch with the same life insurance agency or agent that sold you the term life policy. They will tell you which permanent life plans you are eligible for. Go over all aspects of each of the options offered to you and decide which one to go for, preferably one that offers you the best benefits at an affordable premium.
If you have opted to convert only a part of your term life policy, make sure that you are issued a fresh term policy for the revised amount, along with your new term life policy.
Benefits of converting from term life to permanent life
- Quick and easy: The procedure to convert as detailed above is proof of this. You won't be asked to take a fresh medical exam, and neither will you be asked any health, lifestyle or occupation-related questions.
- The advantage of level premiums, for life: With a term policy, there are always two concerns - what you will do when the policy lapses, and how high the premiums will be if you would need to buy a fresh policy at the end of the term. However, when you choose to convert to a permanent life policy, your premiums will remain the same until you die.
What other options are available?
There are people who just don't want a permanent life policy. If you are one among them, and you already hold an affordable term life policy, check if your policy is renewable, or if you can purchase a renewability rider on it. A renewable term life policy will make it possible for you to renew the policy at the end of the term, without having to prove insurability. The premiums will continue to be affordable, but may be higher than the premium on your lapsed policy.
Whatever may be your final choice, remember that some insurance is better than none at all. Do not cancel any policies until you receive your new policy documents.
AccuQuote is a leader in providing term life quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by comparing thousands of life insurance policies from dozens of top-rated carriers. Article Source: http://EzineArticles.com/?expert=Denise_M |
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