Convertible

What Does Convertible Mean?

The term convertible refers to a feature in a term insurance policy that allows the policyholder to convert a temporary term policy into a permanent one before the term expires, without needing to provide evidence of insurability. This means the policyholder is not required to undergo a medical examination for eligibility, and the insurance company must insure them under the same risk conditions as the original term policy.

Insuranceopedia Explains Convertible

The advantage of term insurance with a convertible feature is that it allows individuals to secure maximum life insurance coverage at the lowest premium (term premium) while managing their current financial priorities. This feature provides the flexibility to transition to a permanent policy later, as their financial situation improves, without losing the benefit of their original state of insurability. While term life insurance covers a limited period, permanent life insurance provides lifelong coverage.