Can I Have a Convertible Term Primer ..

[jboussea]

I'm clueless when it comes to the convertible term . . Here are some questions I'd like answered in this thread
- Are petty much the majority of term insurance sold today convertible to a permanent policy up to the total face value with the same health rating
- Do all the big term companies have at least a decent GUL to convert to?
- Are there any "gotchas" with convertible term
- If I get terminally ill and I have a waiver of premium rider.. I can convert to a permanent without paying the premium?
- if that's the case. How many companies let you convert the waiver of premium rider with the permanent policy

- Generally How does comp work with converting term to permanent... what companies have a bad compensation for the agent when it comes to conversion

- Anything I should know when converting a term to a participating whole life or IUL policy .. for cash value purposes?


Any other tidbit will be appreciated.

Thanks

 

[goillini52]

I'm clueless when it comes to the convertible term . . Here are some questions I'd like answered in this thread
- Are petty much the majority of term insurance sold today convertible to a permanent policy up to the total face value with the same health rating
- Do all the big term companies have at least a decent GUL to convert to?
- Are there any "gotchas" with convertible term
- If I get terminally ill and I have a waiver of premium rider.. I can convert to a permanent without paying the premium?
- if that's the case. How many companies let you convert the waiver of premium rider with the permanent policy

- Generally How does comp work with converting term to permanent... what companies have a bad compensation for the agent when it comes to conversion

- Anything I should know when converting a term to a participating whole life or IUL policy .. for cash value purposes?


Any other tidbit will be appreciated.

Thanks

You should contact WinoBlues on the Forum, as he's the master at converting convertible term.

 

[Newby]

I'm clueless when it comes to the convertible term . . Here are some questions I'd like answered in this thread
- Are petty much the majority of term insurance sold today convertible to a permanent policy up to the total face value with the same health rating
- Do all the big term companies have at least a decent GUL to convert to?
- Are there any "gotchas" with convertible term
- If I get terminally ill and I have a waiver of premium rider.. I can convert to a permanent without paying the premium?
- if that's the case. How many companies let you convert the waiver of premium rider with the permanent policy

- Generally How does comp work with converting term to permanent... what companies have a bad compensation for the agent when it comes to conversion

- Anything I should know when converting a term to a participating whole life or IUL policy .. for cash value purposes?


Any other tidbit will be appreciated.

Thanks

I'm no expert in this area but I can tell you that NO most term policies do not have great options to convert to. If you are going to sell term that you want to convert later you want to make sure you are selling term that converts to ANY of the company's WL or UL choices. Like Ohio National has term plus that has great conversions. But the cheaper version of Ohio National only has one option and it's not a great one.

 

[VolAgent]

1. Yes, with some restrictions, exceptions.
2. No, many have very bad current assumptions ULs as the conversion option. Good convertible term often costs just a bit more.
3. How long is the conversion period, what are the options, and are there any restrictions on conversion? See 4 for an example.
4 and 5. Depends on the product. For instance, the last time I saw a Cincinnati Life policy, conversion was not allowed if the insured was disabled. While Mass Mutual allowed you to convert even if on waiver of premium, the waiver was carried over to the new policy and continued to waive the premiums on the permanent policy (which if you were smart was a whole life). There were no restrictions on what you could convert to if on waiver, however they may have finally put some on this.
6. Again, depends on the company. Most pay full commission on the new premium. If conversion credits are offered, that generally reduces the commissionable premium.
7. Make sure the product you want is an option and that the new premium makes sense for the client.

The best conversion options are going to be written something like this, "...to any permanent product currently offered by the company." Most companies allow conversion during the entire level period with a cap of age 65-70 and a minimum number of years if the age cap is close or already passed at time of issue. Some companies, Mass Mutual at least use to be one, limited conversion to a number of years that was less than the entire level period.

 

[jboussea]

1. Yes, with some restrictions, exceptions.
2. No, many have very bad current assumptions ULs as the conversion option. Good convertible term often costs just a bit more.
3. How long is the conversion period, what are the options, and are there any restrictions on conversion? See 4 for an example.
4 and 5. Depends on the product. For instance, the last time I saw a Cincinnati Life policy, conversion was not allowed if the insured was disabled. While Mass Mutual allowed you to convert even if on waiver of premium, the waiver was carried over to the new policy and continued to waive the premiums on the permanent policy (which if you were smart was a whole life). There were no restrictions on what you could convert to if on waiver, however they may have finally put some on this.
6. Again, depends on the company. Most pay full commission on the new premium. If conversion credits are offered, that generally reduces the commissionable premium.
7. Make sure the product you want is an option and that the new premium makes sense for the client.

The best conversion options are going to be written something like this, "...to any permanent product currently offered by the company." Most companies allow conversion during the entire level period with a cap of age 65-70 and a minimum number of years if the age cap is close or already passed at time of issue. Some companies, Mass Mutual at least use to be one, limited conversion to a number of years that was less than the entire level period.

Thanks

I appreciate it.. what's a good resource to learn about this .. or should I just have to learn the term products out there... I don't have contract with a lot of term companies.. so it's hard for me to get an illustration

 

[VolAgent]

Thanks

I appreciate it.. what's a good resource to learn about this .. or should I just have to learn the term products out there... I don't have contract with a lot of term companies.. so it's hard for me to get an illustration

This isn't stuff you will necessarily find in an illustration. Some of this requires the policy. I didn't know about Cincinnati Life's restrictions on converting while disabled until I read the actual policy. So, you need specimen policies and you need to ask questions of the sales and marketing department at the home office.

 

[Mattschmidt]

Listen to this guy's ^ posts. Not others who rarely sell term and are marketers.

Be smart to who you listen to on this forum

 

[jboussea]

This isn't stuff you will necessarily find in an illustration. Some of this requires the policy. I didn't know about Cincinnati Life's restrictions on converting while disabled until I read the actual policy. So, you need specimen policies and you need to ask questions of the sales and marketing department at the home office.

Wow.. that's interesting.. that's unfortunate... I guess I have to learn the products as I sell them..