Should I Convert Part of my Term Life Insurance to Permanent Life Insurance?9235264

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In case you own convertible term life insurance, your plan contains a provision that enables you to convert the policy to permanent life insurance (cash value insurance) such as whole life, variable life, or universal life.

Convertible term policies typically state that transformation must happen in a specific moment after the coverage is issued, or before you get to a particular age. When the policy is converted, you enjoy all the benefits of cash-value life insurance, including life protection, a more stabilized premium structure, and the tax favored buildup of cash value. (You may pay a higher premium for the cash value insurance.) And, you will not be required to supply proof of insurability during the time of conversion. For instance, when you get a $100,000 term life insurance coverage, you can select to convert $50,000 to permanent life-insurance while keeping $50,000 in term life insurance. Then, you can either retain the remaining term insurance until the term period ends, or after change the $50,000 term policy to permanent life insurance, based upon your needs. The premium you pay for the permanent life insurance plan will ordinarily be based on your age during the moment of conversion (attained age), in some instances it can be based on your age when the first policy was bought (original age). Ask your insurance broker for particulars. click this