When we talk about "converting" we mean changing your term life insurance policy to a permanent plan, such as Universal Life Insurance or Whole Life Insurance.
Generally speaking, there are two types of life insurance – Term & Permanent. Almost everyone who buys Arizona life insurance usually buys term insurance when they are young and permanent insurance the older they get. Arizona term insurance is great for young people because it is cheaper when you buy it younger, but it can become very expensive the older you get.
Arizona term Insurance is cheaper to own compared to Permanent Insurance because you are simply paying for the coverage and the rate usually increases at some point anyway. Permanent Arizona life insurance locks in a premium for the rest of your life and it accumulates cash inside the policy.
When you own Arizona term life insurance it is a good idea to consider "converting" it to a permanent plan. Why convert your term policy?
For starters, Arizona term life insurance premiums increase at some point (to the point of being too expensive to pay for), and the policy simply expires and the coverage ends at a certain age. The other factor is this – if you wait until you are older the cost to buy a permanent plan becomes cost prohibitive. The sooner you convert the term to permanent the better because you lock in a much lower rate.
Many Arizona life insurance companies will give you premium credit equal to the annual term premium on your Arizona term life insurance policy to pay toward a permanent plan. Of course, they want you into a permanent plan because they can then count on having you as a paying client for a very long time.
Secondly, if you live into your old age that term life insurance will be long gone. Just when you need it the policy will either cost too much or the policy will simply end with no benefit to you or your heirs.
Converting your Arizona term life insurance to a permanent plan 1) ensures you will have life insurance as long as you live, 2) locks in a premium today for the rest of your life. That means you do not have to worry about premiums increasing as term life policies do and 3) some permanent policies accumulate cash.
Contact your insurance agent and discuss what is involved in converting your term to permanent life insurance. I believe you will find there to be substantial advantages.
Click this link for a quote on Phoenix Life Insurance or call us at (480) 659-0229.
Sincerely,
Gary Brown, Owner