My Employer’s Group Life Insurance Coverage Ceased When I Was Terminated. Can I Convert To An Individual Policy?

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Asked January 26, 2012

1 Answer


If you meet the conditions in the policy, you may convert a group life insurance plan to an individual plan after you have been terminated. If you choose to convert your life insurance policy, you may also convert the policies of your spouse or dependents in addition to your own policy. Life insurance companies provide different approaches to conversion and portability of life insurance, with varying costs and types for coverage.

In most cases, you will have had to have been insured for a period of time, usually one full year, prior to being terminated. You will also have to bender the age of 65, and the coverage may carry other restrictions, depending on the company and the laws of the state you live in. As long as you meet the requirements, your insurer will probably have one or more conversion provisions available.

Most group life policies are converted to individual whole life policies, but some locations, including the state of New York, require universal life policies to be offered instead. The primary difference between the two policies is the amount of control the insured has over the investments and the ways the cash can be manipulated. Conversion may also carry a maximum cash value, such as a $100,000 limit.

Contact your insurance company as soon as possible after you are terminated to determine exactly what is available to you and how to go about making the conversion as quickly as possible. Failure to convert the policy could result in a loss of all accrued value in the policy, while conversion will carry most of the dividends forward, minus conversion fees and other possible costs.

Answered January 26, 2012 by Anonymous

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