Term life insurance in Florida and nationwide has one inherent flaw – it expires. In every life insurance quote there is a minimum that the company can charge for any given amount of death benefit. This is called “term life insurance” because is has a given period of time or “term” that the policy is good for, which is expressed in numbers of years. The most common term options are anywhere from ten to thirty years in duration, but after that time has expired, the life insurance policy contract has been fulfilled. If the insured is still alive, the policy expires. For some this isn’t a problem, they can just go out and get a new term policy, but for others this is an impossibility.
The problem lies in the applicant’s insurability. Can someone’s health change over a ten or twenty year period? Absolutely! In fact, it can change instantly and unexpectedly. Tragically, our lives can change in the blink of an eye. A doctor’s visit with a diagnosis that you did not expect, or a split second on a busy highway – that’s all it takes! Do you know someone who has had a life changing accident or sudden illness? If someone has a term life insurance policy, and in the course of that term contract has a life changing illness or injury, it can affect their ability to obtain a new contract after the term expires. In fact in many cases, they will not be able to obtain insurance at all. The life insurance carrier will see them as a bad risk and will decline coverage.
Whole life insurance by default lasts the entire life of the insured, but is more expensive. The challenge becomes, “How do I avoid paying an arm and a leg, but keep my insurance through my whole life?” Term life insurance is much less expensive than whole life insurance, but it runs out. What you might not know, is that there are MANY different kinds of conversion options and policies available. Here is what to look for to make sure you’re not left without life insurance coverage in Florida – if someone takes out a term life insurance policy, for a few extra dollars they can get what’s called a “conversion privilege”. What this means is that anytime during that term contract, the insured can change or “convert” that policy into a permanent or “whole life insurance” policy without having to provide further proof of insurability. This, of course, requires a certain kind of term life insurance, but an experienced agent I’ll know how to build it. Furthermore, if you do convert to whole life, keep in mind that there are numerous kinds of whole life insurance, and you want to convert into a policy that serves the purpose of SOLVING YOUR PROBLEM – and that is keeping your same life insurance coverage for your whole life. Some policies get this done very well, others are more focused on cash buildup and cash value. Keep in mind that there is a difference and make sure your life insurance agent explains it fully to you.
The point we are driving home is this: If done right, a term life insurance policy can be converted to a permanent life insurance policy or “whole life insurance” regardless of how your health has changed over the years. This is such an important concept. As a consumer, this can save you thousands of dollars and lots of headache over the years. Do yourself a favor and ask the questions. Need prices? Get a free term life insurance quote today.