What is the term for a rider that allows converting term insurance to permanent insurance without evidence of insurability?

• A. Nonforfeiture option
• B. Extended term rider
• C. Conversion privilege
• D. Purchase option

Answer: (C)

The conversion privilege is the rider described. It lets you swap term insurance for a permanent policy (like whole life or universal life) without needing to show evidence of insurability. That means even if your health has changed since you got the term policy, you can still convert and keep some form of permanent coverage. When you convert, you pay new premiums based on your attained age at the time of conversion and the permanent policy you choose, and you can usually convert all or part of the term coverage within the allowed conversion period.

The other riders serve different purposes. An extended term rider uses the policy’s cash value to extend term coverage but doesn’t convert to permanent. A nonforfeiture option deals with what happens to cash value if the policy lapses. A purchase option lets you buy additional insurance later without further underwriting, but it doesn’t convert existing term coverage into permanent.