What benefit does term conversion provide to policyholders?

Term conversion is a valuable feature for policyholders because it allows them to transform their term life insurance policy into a permanent life insurance policy without the need for medical underwriting. This aspect is particularly beneficial for individuals who may have experienced changes in their health status since obtaining their original term policy. Without this provision, if a policyholder wanted to switch to a permanent policy after the term ends, they would typically have to undergo a new medical examination, which could result in higher premiums or even denial of coverage due to health issues that may have arisen.

The ability to convert means that a policyholder can secure lifelong coverage and the benefits associated with permanent insurance, such as cash value accumulation, without facing barriers related to their current health status. This makes the conversion option a significant advantage, providing peace of mind and financial security as they transition from term coverage to permanent coverage.