What happened to all those term policies you sold in the last 10 plus years?
Term life insurance is bought more than any other life insurance. Some purchasers may only want it for the term period they selected. But many may want to continue coverage past the selected level premium period. For many purchasers this just means going back to the market for anew plan. However, if their health has deteriorated it may not be possible.
Three reasons to focus on term conversions now:
- You can help your client retain insurance coverage even if their health has deteriorated. I just had a request for quote on a client who developed heart problems so severe that they cannot get new life insurance. If they were still within their conversion period I would have recommended that they convert it. But because they are past their conversion period they either have accept the rising premiums or drop the policy.
- Even if the client doesn’t want coverage anymore they may be able to make money by converting to a permanent plan and then selling it in the life settlement market.
- More agent compensation: first on the conversion, then on a life settlement
The recommended course of action for agents:
- Contact any life insurance companies that you have written term with and get a listing of all your still active cases.
- Note he conversion dates for all insureds.
- Contact them at least a year to that date to set the conversion in action. If they are still insurable they can go to the market for the best rate. If their health as deteriorated the you can help them convert.