Conversion Provision allows a policyholder to change a term policy into whole or universal policy without going through the health qualification process again.

• A. Term life
• B. Whole life or universal life
• C. Endowment
• D. Variable life

Answer: (B)

A term-to-permanent conversion provision is a feature that lets you swap a term life policy for a permanent policy without new medical underwriting. The purpose is to maintain life coverage beyond the term period, when term coverage would otherwise end.

The correct target for this conversion is a permanent policy such as whole life or universal life. These are designed to stay in force for life and often build cash value, aligning with the goal of continuing protection beyond the initial term. When you convert, you don’t re-qualify health-wise, but the premium is recalculated based on your attained age and the permanent policy type, so the cost will reflect factors like age and the new policy’s features.

Endowment policies are not typically the conversion outcome in standard term-to-permanent provisions, and while variable life is a permanent product, most exam formulations specify conversion to whole life or universal life.