Question

Which of the following features of a group Term Life policy enables an individual to leave the group and continue his or her insurance without providing evidence of insurability? Options:Ownerâs Rights clauseIncontestable PeriodInsuring AgreementConversion privilege

Answer 1

Conversion privilege.

The correct answer is option D.

Under the conversion privilege, a person may leave the group term plan and keep their insurance without supplying proof of insurability.

Term life insurance plans, commonly referred to as convertible term life plans, frequently feature a conversion privilege. Even if they develop a significant health problem, the policyholder in this instance is still eligible to convert their policy to a permanent one without having to undergo a medical test. This clause essentially guarantees that the policyholder is still insurable despite a decrease in health.

The ability to convert to a permanent policy under a term life insurance policy will probably have an expiration date, and once the policyholder does so, premiums will probably increase. A policyholder with health issues, however, has the choice to keep their life insurance thanks to the conversion privilege. Due to their current health, individuals might have trouble getting coverage if they had to apply for a new policy.

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