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How do thermal conversions work?



A term conversion is simply when you take out a life insurance policy and change, or convert, it into a permanent life insurance policy.

Can someone with a term insurance policy do this? [19659003] Most life insurance policies include conversion options free, but not all, and depending on the life insurance company, these conversion options have different expiration periods.

For example, some insurance companies allow you to convert within the first 5 years, some would do so during the first 20, and some at any time. [19659003]Exactly; and the advantage of a thermal conversion is that if you buy a lifelong insurance and then decide that you want lifelong insurance, you can convert that insurance to a permanent insurance to get the lifelong insurance and the insurance company will not force you to go through reinsurance. And not having to go through the issue again means that if any health issues have arisen between now and when you first bought your insurance, they will not matter.

So, for example, if you are 35 years old, you just bought your first house, and you buy a 30-year life insurance to protect your family while you pay off your mortgage and 5 years into that insurance you have been diagnosed with cancer, you can now convert that term insurance there to a permanent life insurance coverage and the insurance company can not increase your premiums or refuse you based on that cancer diagnosis.

But the conversion will increase your premiums.

Right, but not because of any health factors. Your premiums may increase because your age is still taken into account when you convert and because permanent insurance is generally more expensive than lifetime insurance.

So for someone who buys a lifetime insurance, but who later decides they want more coverage, to convert to a permanent insurance is an excellent alternative.

Definitely. Conversion options are great benefits for insurance owners. So if you are considering buying a life insurance policy, be sure to ask your agent if it includes a conversion option.

And if you shop with Quotacy, you will be able to see all the insurance options. before choosing. You can always call, email or chat with our Quotacy agents if you have any questions regarding the purchase of a life insurance policy.

If you have any questions about the life insurance policy leave us a comment. Otherwise, we'll meet next week when we talk about how living in a Community property state can affect buying life insurance. Goodbye!

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