How to Avoid Outliving Your
Life Insurance Coverage
Term life insurance is a terrific product. It’s inexpensive and easy to understand. It offers exactly what many people need to accomplish their temporary insurance needs.
But, if you have permanent needs, you need permanent life insurance. These include covering final expenses, leaving a legacy for loved ones, paying estate taxes, etc. You want to live for a long, long time, but you don’t want to outlive your life insurance! Permanent coverage may be the best way to prevent that from happening.
Most term life insurance policies offer what’s known as convertibility. This gives you the right to “trade in” your term policy for a permanent one – with no medical exam or health questions. The video below gives a short overview of how the process works.
There is often a limited window of time before the term life insurance conversion privilege expires. (The details are outlined in your policy documentation.) If you’ve ever thought about getting coverage guaranteed to last for a lifetime (as long as you pay your premiums), NOW is a great time to explore your conversion options.
If your health is less than perfect, you’ll want to start this process while the option is still available.
Why Convert Your Term Policy? Why Now?
1) Prices for conversion go up every year as you get older. The younger you are when you convert to a permanent policy, the lower your premiums will be. The longer you wait, the more you’ll wind up paying. This is one of the keys to what we call “winning the game of life insurance;” securing an affordable premium that will remain the same for the rest of your life.
2) Your health has declined and you’re nervous about getting coverage in the future. It happens all the time. Life insurance companies don’t look favorably on diabetes, heart conditions, cancer scares and the like. If your health is less than perfect, you may have a hard time getting a new policy when your current term “expires.” Thanks to your term life insurance conversion privilege, you don’t have to worry about that.
3) You probably have a limited period of time to convert your policy. Some insurance companies reduce your conversion options after a certain number of years. The longer you wait to convert, the more limited your selection may be.
4) We often see insurance companies suddenly pull attractive conversion products off the market, replacing them with less desirable ones. If you don’t apply in time, you could miss out on a great deal. Just recently, we’ve seen three insurance companies replace some of their most affordable plans with ones that can cost twice as much. Those who acted quickly enough were able to convert to the lower-priced products. Those who hesitated missed out.
5) You may be surprised by your financial situation in 20 years. Many people assume they won’t need life insurance after their children are done with college and the mortgage is paid off. That’s not necessarily the case.
Instead of “downsizing” when the kids move out, more and more people are buying new or second homes in their retirement years. In a 2014 survey by Wakefield Research, 53% of Americans aged 49-67 plan to move out of their current homes in retirement, and 25% plan to buy a second home.1
You may need to consider owning life insurance longer than you had previously thought. After all, you don’t want to leave your spouse to fend for him/herself with a new mortgage during those retirement years.
Term conversion can make sure you won’t find yourself unprotected at a time when you need life insurance the most – and may have the most difficulty getting it.
Converting to a permanent policy is easy:
- There are no hassles and no medical exams required.
- Your term life insurance conversion option is guaranteed, even if you’ve had a change in health.
- The premiums on the newly converted policy can often be guaranteed to remain level for the rest of your life.
- Any unused premiums from your existing policy will be credited towards the new one.
We advise people not to wait to explore their conversion options. The younger you are when you convert, the lower your premiums will be for the rest of your life.
Call us today at 800-442-9899 or clicking the red “Get Started” button below.