Term Life Insurance Policy Conversion Comparisons

Conversion is an important feature of a term life insurance policy.  In fact, it's probably one of the least discussed important features.  While most consumers and purveyors of fine life insurance products focus on price-- conversion is often overlooked.  So what is it?  Conversion is a feature that's built into a term life insurance policy that ensures you'll have the opportunity to sew up life insurance forever-- even if you only bought a short term life plan.  Conversion allows you to exchange your term plan for something permanent within certain guidelines.  You're allowed to convert without proving to the insurance company that your health is still good.  So no matter what adverse change may occur while you have your term life insurance policy in force-- the insurance company will still allow you to move to a permanent plan that's available from that company at that point in time.  Find out you have cancer 18 years into the term of your existing plan-- no problem.  Convert it to something permanent.  Heart attack?  So what.  You're still insurable as long you choose to convert within the specified time frame. 

At least 2 companies out of the 10 companies we chose to compare also offer a conversion credit as well.  The credit allows you to use 12 months worth of premium as sort of a down payment on a permanent plan when you decide to convert. 

You should be aware however that when you convert-- you'll be older.  So the permanent plan you convert to will cost more then than it will now.  Also-- because the plan you're converting to is indeed "permanent" (usually you'll convert to a Universal Life Insurance Policy), it's more expensive simply because of this fact.  Permanent coverage costs more which is a big reason why term life insurance is so popular. 

The main reason conversion is so vitally important is that it gives you options for the future when under adverse health circumstances-- options may not be available otherwise.

So here is how ten of the top term life insurance providers in the country extend the conversion privilege to their customers:
 

Company Name	Product Name	Conversion Privilege Explanation
American General Life Insurance Company	Select-A-Term	American General is part of AIG… They're huge and they're A++ rated by A.M. Best.  So their conversion options are among the best in the term life insurance market.  The Select-A-Term plan can be converted to a level premium, level death benefit permanent life insurance plan of the company's choosing during the conversion period.  No need to prove you're still insurable when you convert either...  You can convert until the end of the level term period or until you're 75 years old-- whichever is sooner.
	Ultra-C	Conversion options for the Ultra-C are the same, for the most part, as Select-A-Term.  There is one significant, notable exception.  A conversion credit is available.  The credit is equal to the premium paid within the previous 12 months, up to the annualized premium amount.
Genworth Life Insurance Company	Sure Term	Genworth Life Insurance Company is A+ rated bf A.M. Best and have solid conversion options.  But what was most noticeable about them was the laundry list of caveats that do not exist with ING Reliastar or American General.  Here's what is said about their convertibility:  Policy can be converted for any HIGHER PREMIUM policy of permanent life insurance made available for this purpose.  The face amount of the permanent plan can't be higher than the term plan and can't be less than the minimum for the permanent plan selected.   Conversion premiums are based on "attained age", without evidence of insurability.  The plan can be converted at any premium due date during the initial term you've purchased-- or up to age 75-- whichever comes first.  They also specify that conversion is allowed for 10 and 15 year term plans when issued in the age range of 75-80 up to one year from the exchange date referred to in the policy.  In other words, if you're between the ages of 75 and 80 and you purchase a Genworth plan-- you won't know your conversion options until you see the policy.
ING Reliastar Life Insurance Company	TermSmart	ING Reliastar is A+ rated by A.M. Best, very solid and very competitive with respect to premiums.  Their TermSmart plan is convertible without evidence of insurability  to certain select permanent life insurance plans.  Conversion is allowed until age 75 or until the end of the level term period, whatever happens first.
RBC Liberty Life Insurance Company	Level Term	Liberty Life Insurance Company (RBC Liberty Life Insurance Company) is A rated by A.M Best.  Not so sure about Liberty's conversion options actually.  They're not exactly stellar.  It's unclear what products they have available for conversion since they don't appear to be very active in the permanent life insurance arena.  They seem to be working toward something though...  rumors abound about using products from a related company-- BMA.  Anyway-- they claim their Level Term plan can be converted in whole or part without evidence of insurability prior to the earlier of the end of the level premium period and attained age 70.
West Coast Life Life Insurance Company	Focus Term	West Coast Life Insurance Company is an A+ rated carrier by A.M. Best.  They're known for being one of the most cost effective providers in the term market right now and have good conversion options.  With West Coast, a Focus Term plan can be converted before the end of the level term period without evidence of insurability or until the age of 75 whichever comes first.
Prudential Financial	Term Elite	Prudential Financial is an A+ rated company by A.M. Best.  In their Term Elite product, you could be eligible for a conversion credit.  If the Term Elite plan is converted within the first 5 years, you can earn eligibility to apply term premiums due and paid during the 12 months prior to the conversion, excluding any premium or charge or an extra risk or benefit other waiver of premium.  Conversions processed prior to the first policy anniversary will be prorated to reflect the premiums actually paid during the first anniversary of the contract.  Ultimately, the policy can be converted without evidence of insurability to the first policy anniversary, whichever is longer.  Partial conversions ar permitted.
	Term Essential	Convertible to the lesser of the level premium period or to the first policy anniversary on or after the insured's 65th birthday, but at least 5 years.  Partial conversion is permitted and NO CONVERSION CREDIT is available with this plan.
Transamerica Occidental Life Insurance Company	Trendsetter	Transamerica Occidental Life insurance company is A+ rated by A.M. Best.  The conversion option is included on all Trendsetter products. Conversion must be exercised no later than the earlier of: (a) the end of the initial level premium period, or (b) insured's 70th birthday; insured's 75th birthday on Preferred Plus.
Banner Life Insurance Insurance Company	OP Term	Banner Life Insurance Company is A+ rated by A.M. Best.  Their OP Term plan is convertible for the duration of the guaranteed level premium period or up to attained age 70, whichever comes first. Policies issued at age 66 or over are convertible during the first five policy years.
Old Mutual Financial Network	Saver's Select	Old Mutual Financial Network is A rated by A.M. Best.  Their Saver's Select plans are convertible on or before the 10th policy anniversary.  Conversion is available to an Old Mutual Finanacial Life approved Universal Life Insurance policy.