What does "term conversion" allow a policyholder to do?

Term conversion is a provision that allows a policyholder to change a term life insurance policy into a permanent life insurance policy, such as whole life or universal life. This feature is beneficial because it provides the policyholder with the option to secure lifelong coverage without the need for additional medical underwriting at the time of conversion, which might be particularly advantageous if the individual's health has declined since the original policy was issued.

This option typically comes with certain conditions, such as a time limit within which the conversion must take place and specific age limits. By allowing this conversion, policyholders can transition to a permanent policy that offers lifelong coverage, cash value accumulation, and the potential for policy loans, aligning with changing financial goals and security needs as they age.