What is convertible term insurance?

Question: What is convertible term insurance?

Answer: Convertible term insurance is a policy that contains a provision allowing it to be converted to permanent life insurance at a later date. Because term insurance is often the cheapest life insurance available, many individuals start with a term insurance policy. However, once a term life insurance policy expires, purchasing a new life insurance may prove to be significantly more expensive because you have aged, and as a result your risk has increased, and if you have any had any health complications you may experience difficulty finding a new policy.

Permanent life insurance, such as a whole life policy, provide lifetime coverage so long as you pay the premiums. Convertible term insurance allows individuals to begin with a term life insurance policy and later convert to a permanent life insurance policy.