Oklahoma Life Producer Practice Exam

A convertible policy goes from _______ to ________.

1. term to perm

2. renewable to term

3. whole to term

4. level to whole

The correct answer is: term to perm

A convertible policy typically allows the policyholder to convert a term life insurance policy into a permanent life insurance policy, such as whole life insurance, without having to provide evidence of insurability. This feature is valuable because it provides flexibility to the insured, allowing them to transition to a more permanent coverage option as their needs change over time or as they get older. Term policies are temporary and provide coverage for a specified period, whereas permanent policies provide lifetime coverage as long as premiums are paid. The ability to convert from term to permanent coverage ensures that individuals can secure lifelong protection even if their health condition changes after the initial purchase. This characteristic is a key selling point of convertible policies, addressing concerns about future insurability.