Convertible Term: Conversion Cost — Maple Groove Financial

Compare attained-age vs original-age conversion to permanent insurance, and see why the incontestability clock is never reset.

Original issue age 45

Age when the convertible term policy was first bought.

Years held before converting 9

Attained age at conversion: 54

Coverage amount $500,000

Original-age catch-up method

Lump sum = the cash value a permanent policy would have built since issue.

Attained-age premium

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Original-age premium

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Annual saving (orig.)

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Original-age lump sum

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Break-even

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Contestability & suicide clock

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Cumulative cost after conversion: attained-age (low start, steep) vs original-age (lump sum up front, lower ongoing premium). Where the lines cross is your break-even.

How this works. A convertible term policy lets you switch to permanent insurance with no new medical evidence. In an attained-age conversion the permanent premium is priced on your age today: higher, but nothing due up front. In an original-age conversion the premium is priced on your age when the term policy started: lower for life, but you must pay a lump-sum catch-up (either the cash value a permanent policy would have accumulated, or the extra premium you would have paid). The chart shows how long the lower premium takes to repay that lump sum.

Because the converted policy is treated as an extension of the original, the two-year incontestability and suicide clocks run from the original issue date and are not reset, a key advantage of converting rather than applying anew.