An Allstate term policy raises a question most term pages never have to address: if the company that holds your block no longer sells permanent insurance, what exactly are you converting into? Term is sellable only while a conversion privilege is live, because a buyer needs a contract that will still exist when the insured dies. And Allstate’s individual life block is now administered by Everlake Life Insurance Company — the renamed Allstate Life Insurance Company, sold to Blackstone-managed entities in a transaction Allstate announced closing on November 2, 2021 — which operates in run-off and does not write new policies.
Your contractual right to convert survived the transfer intact. Every right in the policy did. What is not automatic is the answer to the practical question: which permanent plans are actually available to convert into today, and at what premium. That is the single most important thing to establish, in writing, before spending any time on valuation.
This page walks through where the deadline sits, how to pin down the conversion menu on a run-off block, why buyers will not touch unconvertible term at any price, and what to do in either outcome. Pine Lake Life Solutions provides education and a free policy review; it does not purchase policies and is not licensed in every state.
In This Article
The run-off problem: a live right with an unclear menu
A conversion privilege is a contractual promise, and a company that acquires a block acquires the obligations along with it. Everlake must honor a valid conversion right. But conversion provisions are worded in one of two ways, and which one your contract uses changes everything.
Some provisions promise conversion to any permanent plan the company then offers. On a run-off block that phrase becomes genuinely ambiguous, because the company offers nothing to new buyers. Carriers in this position typically designate a specific conversion product and file it with the relevant insurance departments so the obligation can be met, but you should not assume what it is or what it costs.
Other provisions name a specific conversion plan in the contract itself. That is cleaner: the plan is identified, and the carrier must issue it, though the premium is set at the insured’s attained age.
Either way, the instruction is the same. Write to the servicing company, cite the policy number, and ask four questions in one letter: on what calendar date does the conversion privilege expire; which permanent plans is this policy convertible into today; what is the annual premium for each at the insured’s current attained age; and is evidence of insurability required. Ask also for a verification of coverage letter confirming the policy is in force and paid to a specific date. Keep a dated copy of everything. On a run-off block there is no agent to chase this for you, and persistence is the whole job.
Where the deadline actually sits
Individual term contracts state the conversion right as an earlier of condition: the earlier of a stated number of policy years or a stated attained age of the insured. Across the industry it is completely routine for the right to close years before the level premium period does, and the mismatch is where people lose the option without noticing.
Work an example. A 30-year level term issued at age 47, with a conversion right ending at attained age 65, gives eighteen years of convertibility and thirty years of coverage. At age 68 the owner still has twelve years of death benefit, a policy that is perfectly valid, and no conversion right at all. Nothing in the annual premium notice announces that the door closed three years earlier.
Two further conditions decide whether the right is usable in practice. Partial conversion — most contracts permit converting a portion of the face amount subject to a stated minimum, which is often the only affordable route. And in-force status — conversion generally requires the policy to be current on premium, so a contract sitting in its grace period can forfeit the right even before the calendar deadline. If money is tight while you sort this out, keep the term premium paid. The steps when a lapse is looming are in what to do when a policy is lapsing, and the provision itself is explained in the term conversion rider.
Which company holds your contract
Match your paperwork to one of these before writing to anyone.
- Allstate Life Insurance Company, NAIC company code 60186, domiciled in Illinois, is now Everlake Life Insurance Company, renamed on November 8, 2021. Allstate reported total proceeds of $4 billion on the sale, inclusive of Blackstone’s approximately $2.8 billion purchase price. The Illinois Department of Insurance remains the domiciliary regulator. Allstate Assurance Company became Everlake Assurance Company in the same transaction.
- Allstate Life Insurance Company of New York was sold separately to Wilton Re and renamed Wilton Reassurance Life Company of New York, supervised by the New York State Department of Financial Services.
- American Heritage Life Insurance Company, domiciled in Florida and based in Jacksonville, is still an Allstate company and writes the worksite and group business marketed as Allstate Benefits. Group term certificates sold at an employer typically live here, and certificates follow group rules rather than individual policy rules.
Note that Allstate exited life manufacturing in 2021 while retaining a distribution force. If an Allstate agent offers you a new life policy today, ask which company underwrites it — the answer will not be Allstate Life Insurance Company, and it determines who you deal with for the next thirty years.
If your document is a certificate under a group master policy rather than a policy you own, the analysis changes substantially. Certificates generally cannot be assigned or sold, coverage often ends with employment, and the route out is the group conversion privilege, customarily exercisable within 31 days of coverage terminating.
| Question to ask in writing | Why it matters | What a good answer looks like |
|---|---|---|
| On what date does the conversion privilege expire? | It is the earlier of a policy year or an attained age, often long before the level period ends | A specific calendar date, not a policy year |
| Which permanent plans can this policy convert into today? | A run-off block sells nothing new, so the menu must be designated | Named products with form numbers |
| What is the premium at the insured’s attained age? | It becomes the buyer’s ongoing cost and drives any offer | Annual premium quoted per plan |
| Is evidence of insurability required? | A true conversion right requires none | An unqualified no |
| Is partial conversion allowed, and what is the minimum? | Often the only affordable route | Yes, with a stated minimum face amount |
Why unconvertible term has no market
A settlement buyer computes the death benefit discounted from its expected payment date, subtracts the premiums it must fund until then, and subtracts its required return. That model presumes the policy is alive at the insured’s death.
Unconvertible term defeats the presumption. When the level period ends the contract either terminates or continues at annually renewable rates deliberately priced to make continuation irrational; at advanced ages those renewal premiums can consume a large share of the face amount each year. There is no cash surrender value to recover either, because nonforfeiture values are a feature of permanent contracts. A buyer would be paying today for an asset scheduled to vanish.
This is why convertibility is the first question a competent intermediary asks. If a firm requests a signed HIPAA authorization, a Social Security number and physician names before establishing whether the policy can be converted, the sequence is backwards and the request should be refused. What a legitimate intermediary does, and how brokers are compensated, is set out in what a life settlement broker is.
If the window is open: do the math before you convert
Conversion is not free and is not automatically correct. The converted policy carries a premium set at the insured’s attained age today, and that premium becomes the ongoing obligation any buyer inherits — which directly reduces what a buyer will pay for the same face amount, sometimes below the point of being worth doing.
Where the arithmetic tends to work: a large face amount, an insured past 70 or carrying a documented impairment that shortens projected life expectancy, and a conversion product with a strong secondary guarantee that a buyer can fund efficiently. A guaranteed universal life design is the ideal conversion target for this purpose, because the funding obligation is known rather than estimated — see selling an Allstate guaranteed universal life policy for how those contracts behave.
Where it does not work: a modest face amount, a healthy insured in their early sixties, or a conversion menu offering only an accumulation-oriented contract whose premium is flexible and whose durability depends on crediting assumptions.
Keep the sequence straight. Confirm the right, obtain written product and premium quotes, then evaluate. Offers are made on a permanent contract that exists, not on the possibility of creating one. The head-to-head is in life settlement versus term conversion, and the general screen is in can I sell a term life insurance policy.
One timing note specific to run-off blocks: administrative turnaround can be slower than on an active carrier, and conversion applications sometimes route through a designated unit rather than a general service line. If your deadline is within twelve months, start now and send the request by a method that produces proof of delivery.
If the window has closed
Then the policy has essentially no market value, and the honest thing is to say so and move to the things that do produce value.
- Read the rider schedule. Terminal illness accelerated death benefit riders are commonly attached to term contracts at no extra premium and pay an advance directly from the carrier on a qualifying diagnosis — no sale, no third party, no medical records leaving your control. Most require physician certification of a life expectancy under 12 or 24 months.
- Decide about the premium deliberately. If the insured’s health has declined and years remain in the level period, continuing to pay is frequently the best value in the household budget. The fact that a policy cannot be sold says nothing about whether it is worth keeping.
- Update the beneficiary designation. On a transferred block this is worth confirming in writing, because families searching under the original carrier’s name routinely fail to locate the policy at claim time. Record the current servicing company name and policy number with your estate papers.
- Inventory everything else. Term is rarely the only coverage a household holds. A permanent contract elsewhere — including one on a spouse who has already died and was never claimed — may be the one with options.
The broader framework is in selling a term life policy. Pine Lake Life Solutions reviews policies at no cost and will tell you directly when there is nothing to pursue. It does not purchase policies and is not licensed in every state.
Frequently Asked Questions
Everlake does not sell new policies. Can I still convert?
Yes. A conversion privilege is a contractual obligation that transfers with the block, so the servicing company must honor a valid right. What is not automatic is the menu, since a run-off carrier offers nothing to new buyers and typically designates a specific conversion product filed with the relevant insurance departments. Ask in writing which plans are available today and what each costs at the insured’s attained age.
How did my Allstate policy end up with Everlake?
Allstate sold its individual life and annuity business to entities managed by Blackstone, announcing the closing on November 2, 2021 with total proceeds of $4 billion inclusive of Blackstone’s approximately $2.8 billion purchase price. Allstate Life Insurance Company was renamed Everlake Life Insurance Company on November 8, 2021. Every contractual term, including your conversion right, transferred unchanged. Only the servicing name and address moved.
Why can I not sell my term policy outright?
Because a buyer pays for a death benefit it expects to collect, and term is engineered to expire before the insured is statistically likely to die. Once the level period ends the contract terminates or renews at rates priced to make continuation irrational, and there is no cash surrender value to recover. Only a live conversion right, producing a permanent policy, gives a buyer something to price.
My coverage is a certificate through my employer. Does that count?
It follows different rules. A certificate makes you a participant under a master group policy your employer owns, and certificates generally cannot be assigned or sold to a third party. Coverage frequently ends when employment does. The available route is the group conversion privilege, customarily exercisable within 31 days of coverage terminating, which produces an individually owned permanent policy that can then be evaluated.
How long should I allow for a conversion on a run-off block?
Longer than you would on an active carrier. Administrative turnaround can be slower, requests sometimes route through a designated unit rather than a general service line, and there is no agent pushing the file. If your conversion deadline falls within the next twelve months, start immediately, send requests by a method that produces proof of delivery, and keep dated copies of everything you send.
Is it worth keeping a term policy that cannot be sold?
Frequently yes. If the insured’s health has declined and years remain in the level period, the expected value of the death benefit can far exceed the remaining premiums, which makes continuing one of the better uses of the money. Check the rider schedule too, since a terminal illness accelerated benefit can pay from the carrier itself without any transaction with an outside party.
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Related Reading
- What Is A Term Conversion Rider
- Life Settlement Vs Term Conversion
- Sell Term Life Policy
- Can I Sell A Term Life Insurance Policy
- What Is Verification Of Coverage
- Sell My Allstate Guaranteed Universal Policy
- What Is A Life Settlement Broker
- Policy Lapsing What To Do
Pine Lake Life Solutions does not purchase life insurance policies and does not provide legal, tax, or investment advice. Information provided is for educational purposes only. Eligibility for any option, including life settlements, is not guaranteed and depends on individual circumstances, policy terms, underwriting, and market conditions. Consult independent legal, tax, or financial professionals before making decisions regarding a life insurance policy.