Life Insurance

Convert Your Term-Life into Whole Life or Universal Life Insurance Policies

There is a paradox about life insurance policies. The people who most need life insurance are young couples starting families. While these people will qualify the best life insurance rates, they are often too financially strapped to invest in life insurance. By the time that they are financially able to make the investment, they will not longer qualify for the best rates. One of the best – and most often overlooked – solutions for these people is to purchase term life insurance and later convert it into whole life or universal insurance.

 

Term life insurance is much cheaper than the other types of life insurance, but it is very limited in that it only offers coverage for a set time period, usually 10-30 years. Even if your term has not yet run up, you can still usually covert the policy into a life insurance plan which covers you until death.

 

The main benefit of converting your term life insurance policy into whole life or universal life insurance is that you will not have to go through any examination process. If you were healthy when you bought the term life policy, you will get a policy based on being healthy – even if you have had serious health complications since then. Converting from term life insurance is as easy as signing your name on a check.

 

Another thing that many life insurance policyholders don’t realize is that they don’t have to convert their entire term life policy at once. If you are only financially able to convert a small amount at a certain time, you can opt just for that amount. This allows you the freedom to grow your investment as your assets become available.

 

For those who don’t convert their term life insurance policies to permanent ones, the premium price is going to jump to keep the policy open. Buying another policy after your term life insurance has lapsed can be difficult if your health has gone downhill. That is why it is so important for you to consider the long-term picture when you purchase term life insurance.

Convert Your Term Life into Whole Life or Universal Life Insurance Policies

If you are just now looking into term life insurance, it is important to consider whether you will benefit from converting it to whole or universal life insurance later. If so, then you must make sure that the policy is convertible. Almost all term life insurance policies can be converted but don’t assume it. Also, see what the deadline is for conversion. Even though you will still be given the same health status as when you bought the term life insurance policy, the insurance companies will consider the fact you are aging. The longer you wait to convert the policy, the more expensive it is going to cost.

 

Most people look at term life insurance as short-term, cheap solutions for providing that security you need. But don’t just opt for the cheapest life insurance policy you find. You will want to make sure you are getting a high quality policy and that the quality parts of the policy can be converted to whole or universal life insurance in the future.