Bankrate follows a strict editorial policy, so you can trust that
we’re putting your interests first. Our award-winning editors and
reporters create honest and accurate content to help you make the
right financial decisions.
Key Principles
We value your trust. Our mission is to provide readers with
accurate and unbiased information, and we have editorial standards
in place to ensure that happens. Our editors and reporters
thoroughly fact-check editorial content to ensure the information
you’re reading is accurate. We maintain a firewall between our
advertisers and our editorial team. Our editorial team does not
receive direct compensation from our advertisers.
Editorial Independence
Bankrate’s editorial team writes on behalf of YOU – the reader.
Our goal is to give you the best advice to help you make smart
personal finance decisions. We follow strict guidelines to ensure
that our editorial content is not influenced by advertisers. Our
editorial team receives no direct compensation from advertisers,
and our content is thoroughly fact-checked to ensure accuracy. So,
whether you’re reading an article or a review, you can trust that
you’re getting credible and dependable information.
You have money questions. Bankrate has answers. Our experts have
been helping you master your money for over four decades. We
continually strive to provide consumers with the expert advice and
tools needed to succeed throughout life’s financial journey.
Bankrate follows a strict editorial policy, so you can trust that
our content is honest and accurate. Our award-winning editors and
reporters create honest and accurate content to help you make the
right financial decisions. The content created by our editorial
staff is objective, factual, and not influenced by our
advertisers.
We’re transparent about how we are able to bring quality content,
competitive rates, and useful tools to you by explaining how we
make money.
Bankrate.com is an independent, advertising-supported publisher
and comparison service. We are compensated in exchange for
placement of sponsored products and, services, or by you clicking
on certain links posted on our site. Therefore, this compensation
may impact how, where and in what order products appear within
listing categories. Other factors, such as our own proprietary
website rules and whether a product is offered in your area or at
your self-selected credit score range can also impact how and
where products appear on this site. While we strive to provide a
wide range offers, Bankrate does not include information about
every financial or credit product or service.
Dear Insurance Adviser,
I currently have a $500,000 level term life insurance policy. The premium is scheduled to increase from $525 a year to $7,000 per year. I would like to convert this term life policy to permanent universal life or variable universal life with another insurance company but without having to go through a physical exam. Will I be able to find an insurer willing to convert another company’s term policy in this way?
— Samantha
Dear Samantha,
The short answer is “no.” You won’t be able to convert an existing term life insurance policy to a permanent one with anyone other than your current insurance company or an insurer that acquires the company and all of its policy obligations.
Your existing policy has a 20-year term and level premiums. The good news about that policy is that the rates have been unbelievably reasonable and were guaranteed not to change for 20 years. The bad news is that once the 20-year guarantee is over, the rates can skyrocket — as you are experiencing. Even worse, these tremendously inflated rates will continue to increase annually — and dramatically!
There’s a saving grace for those who can’t qualify, medically, for new life insurance with another insurer. An insurance company usually offers an opportunity to convert term insurance coverage to a permanent, cash-value-type policy. If you still need coverage, I encourage you to convert your existing policy.
Remember that you have the right to convert any or all of your $500,000 of coverage, subject to the company’s minimum requirements, typically $50,000 or $100,000.
One caution: You mentioned that your rates are about to change soon. Many times, the conversion must be exercised before the date the rate changes. Check that out with your life insurance agent before it’s too late.
Good luck!
Ask the adviser
To ask a question of the Insurance Adviser, go to the”Ask the Experts” page and select “Insurance” from the drop-down box. Read more Insurance Adviser columns.
Bankrate’s content, including the guidance of its advice-and-expert columns and this website, is intended only to assist you with financial decisions. The content is broad in scope and does not consider your personal financial situation. Bankrate recommends that you seek the advice of advisers who are fully aware of your individual circumstances before making any final decisions or implementing any financial strategy. Please remember that your use of this website is governed by Bankrate’s Terms of Use.
Share