Most term policies look like they expire to nothing, and for some that's true. But a convertible term policy can hold real cash value while you still hold it — if you act before the conversion window closes. Find out whether yours qualifies.
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Term life is sold as pure protection: you pay for coverage, and if nothing happens during the term, the policy quietly ends. That story is right for most term policies — but not all of them.
The difference comes down to a single feature buried in many term contracts: the right to convert to permanent coverage. A policy that still carries that right — with the window open — can be turned into something the secondary market is willing to buy, which means it can hold real value while you're alive and holding it. That value isn't a number printed on your policy; it's what an institutional buyer would pay for it today.
Usually, no — and that honesty matters, because it's what separates the term policies that qualify from the ones that don't. A standard term policy builds no cash value, and when the term ends, the coverage simply ends with it. There's nothing for a buyer to purchase.
The policies that can be sold share one trait: they are still convertible to permanent coverage, and the conversion window hasn't closed yet. Convert the policy, and it becomes permanent coverage — which is exactly what institutional buyers purchase through a life settlement. Miss the window, and that door closes for good.
That window is the whole game, and it runs on a fixed schedule. We cover the mechanics in depth in can you sell a term life insurance policy, and exactly how the deadline works in the convertible term deadline trap. If you are weighing whether to take cash out instead, cashing in a term policy covers what a carrier will and won't pay, and who buys term life insurance policies explains who is on the other side of the transaction. The diagram below shows why timing decides everything.
Most of a term policy's life sits flat at zero. The value lives inside the conversion window — and only until it closes.
Whether a term policy can be sold depends on its conversion option and how much of that window is left — every policy is different.
Selling term life isn't selling the term policy as-is — it's converting first, then selling the permanent coverage. Four steps, and Lifestone handles the parts that involve your carrier.
The whole question turns on one provision: can your term policy still be converted to permanent coverage, and is that window open? This is the part most owners have never looked at. We help you find it — or you can read how to check it yourself.
If the option is live, you exercise it with your carrier — usually with no new medical exam. The term policy becomes a permanent one, and a permanent policy is what the secondary market can actually buy.
Lifestone presents the converted policy to a network of institutional buyers who compete for it. We handle the paperwork and coordination with your carrier so you are not chasing anyone.
If an offer comes back that fits, you choose whether to accept. You walk away with a lump sum and the buyer takes over the premiums. There is no obligation at any step.
Once a convertible term policy becomes permanent coverage, the buyers are the same institutional investors active across the whole life settlement market — large investment funds and specialty finance firms that purchase policies as long-term assets, take over the premiums, and receive the death benefit later. They aren't individuals, and there isn't a single company you walk up to.
Lifestone is not the buyer. We are a family-owned life settlement company that connects sellers with institutional buyers — and shops each policy across several of them so they compete for it, rather than relying on one company's number. If you want the fuller picture of how that market is structured, our guide to companies that buy life insurance policies walks through it.
What buyers look for in a converted term policy is consistent: an insured who is 65 or older, a face value large enough for the secondary market, and a financially sound carrier behind the coverage. Our overview of selling a life insurance policy covers what happens once the policy is permanent.
It depends on the policy rather than a fixed formula. What a term policy is worth on the secondary market comes down to whether it is still convertible, the insured’s age (generally 65 or older), the death benefit, and the insured’s health. Because Lifestone shops your policy to several institutional buyers so they compete for it, the offer reflects the open market rather than one company’s number. A free, no-obligation review is the only way to see where your policy stands.
If your term policy is convertible and the window is still open, you exercise that option to turn it into permanent coverage, and the permanent policy is what gets sold. Lifestone reviews your policy, coordinates the conversion with your carrier, and presents it to institutional buyers. If an offer fits, you decide whether to accept — there is no obligation either way.
Finding out where you stand costs nothing — the policy review is free and comes with no obligation to move forward. Lifestone is a family-owned life settlement company, not the buyer; we shop your policy across several institutional buyers so they compete for it, and any compensation is built into the transaction rather than charged to you up front. You see the offers first and decide whether to accept.
The timeline runs across a few stages: confirming your term policy is still convertible, exercising the conversion with your carrier, and then shopping the permanent policy to institutional buyers. Once buyers have what they need, an offer typically comes back within a couple of weeks, and you receive a lump sum after you accept. Lifestone coordinates the conversion and paperwork with your carrier so the process keeps moving without you chasing anyone.
Generally, a term policy that is still convertible to permanent coverage, with the conversion window open, on an insured who is 65 or older, and with a face value large enough for the secondary market. A policy that has already passed its conversion deadline, or never had a conversion option, typically cannot be sold.
No. Lifestone is a family-owned life settlement company that connects sellers with institutional buyers — we do not purchase policies ourselves. We shop your policy across multiple buyers so they compete for it, then bring the offers back to you. You decide whether to accept, and the review is free with no obligation.
The conversion window closes on a fixed schedule — the sooner you check, the more options you have. A free, no-obligation review tells you where your policy stands.
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