Only while the conversion privilege is alive, and with this carrier there is a second question most guides skip: what can the policy be converted into? A settlement buyer holds a policy until the death benefit is paid, so pure term insurance, which expires by design, is worth almost nothing to them. What they are buying is the contractual right to exchange the term contract for permanent coverage at attained age with no new medical underwriting. That right is valuable on an impaired life and worth very little on a healthy one.
Where Equitable differs from a generic term carrier is the conversion menu. Its permanent retail lineup is oriented toward variable and indexed universal life, which are cash-accumulation designs with market exposure rather than fixed no-lapse guarantee products. A buyer’s carrying cost on a variable universal life contract is less predictable than on a guaranteed universal life contract, and that shows up directly in the offer. So the sequence is: find the deadline, then find the menu, then find out what an offer looks like.
In This Article
- Locate the deadline, and expect it to arrive early
- Why the conversion menu changes the offer
- Which Equitable entity issued the policy
- New York’s best interest rule, and the advice you are being given
- Sequencing: convert first, or sell the term policy as it is?
- Who actually has a case, and what to send
- Frequently Asked Questions
Locate the deadline, and expect it to arrive early
Conversion privileges normally expire at the earlier of two triggers: a stated attained age of the insured, commonly between 65 and 70, or a stated policy year, often 10 or 15 even on a 20- or 30-year level product. Whichever arrives first ends the right. It is entirely ordinary for a 30-year policy to lose conversion at year 15 with fifteen years of level premium remaining, and owners are routinely surprised by that.
Look in the policy for a provision headed Conversion Privilege, Right to Convert, or Exchange Option, and check the schedule page for a separate conversion rider carrying its own expiry. Then confirm the date in writing with Equitable’s policy service center. Verbal answers from a service representative are not something you can build a decision on eighteen months later.
Ask four questions at the same time and get all four answers in writing. What is the last date conversion may be exercised? What permanent plans are currently available for conversion on this specific contract? May the full face amount be converted, or only a portion? Is any premium credit applied on conversion? The third question catches a restriction that materially changes value. A conversion right limited to a fraction of the face amount is a much smaller asset than a full one, and buyers price accordingly. Our overview of how a term conversion rider works covers the exchange itself.
Why the conversion menu changes the offer
Once converted, the buyer owns a permanent policy and becomes responsible for keeping it in force for the rest of the insured’s life. The cheaper and more predictable that carrying cost is, the more the buyer can pay today. This is where the plan you convert into does real work.
A guaranteed universal life design with a long no-lapse guarantee is the buyer’s preference: pay a defined premium and the death benefit is contractually guaranteed to a stated age regardless of interest rates or market performance. Carrying cost is a known number. Our explanation of guaranteed universal life covers why that structure prices well.
A variable universal life contract is the opposite. Cash value sits in subaccounts exposed to market risk, cost of insurance charges rise with attained age, and there is generally no guarantee that the policy stays in force if performance disappoints. The buyer must underwrite the possibility of funding it more heavily than planned, and prices in that uncertainty. An indexed universal life chassis sits somewhere between, with caps and floors that limit but do not eliminate the variability.
So the practical instruction is specific: when you ask Equitable for the conversion menu, ask explicitly whether any guaranteed universal life or no-lapse design is available on your contract. If the menu is limited to variable and indexed products, that is not a dealbreaker, but it is information a buyer will use and you should have it before, not after.
Which Equitable entity issued the policy
Several company names lead to different places, and this is worth two minutes with the face page.
Equitable Financial Life Insurance Company is the principal entity, domiciled in New York and regulated by the New York State Department of Financial Services. It carries the history of The Equitable Life Assurance Society of the United States, founded in 1859, which demutualized in 1992 and was later renamed AXA Equitable Life Insurance Company before adopting the Equitable Financial name in 2020. Its parent listed publicly in 2018 and rebranded as Equitable Holdings in 2020, with AXA subsequently exiting its stake.
Equitable Financial Life Insurance Company of America is a separate insurer domiciled in Arizona. It was formerly MONY Life Insurance Company of America and is used for business in various states outside New York.
MONY Life Insurance Company, the New York MONY entity, is a different story entirely. AXA sold it to Protective Life in 2013, so a policy naming that company is serviced by Protective today and Equitable cannot process your conversion.
Getting this right first saves weeks. A conversion request sent to the wrong carrier does not get forwarded; it gets returned, and the deadline keeps running while it does.
| Conversion target | How the policy behaves | Typical effect on buyer pricing |
|---|---|---|
| Guaranteed universal life with no-lapse guarantee | Fixed premium, death benefit guaranteed to a stated age | Most favorable; carrying cost is a known number |
| Indexed universal life | Caps and floors; crediting varies, charges rise with age | Moderate; some uncertainty in carrying cost |
| Variable universal life | Subaccounts exposed to market risk; no lapse guarantee typically | Least favorable; buyer prices in funding uncertainty |
| Whole life, if offered | Fixed premium, guaranteed cash value, participating | Favorable but premium level can be high at attained age |
| Partial conversion only | Smaller permanent face amount available | Offer scales down with the convertible amount |
New York’s best interest rule, and the advice you are being given
If the policy was issued in New York, there is a consumer protection worth knowing about. New York Insurance Regulation 187 applies a best interest standard to recommendations involving life insurance policies, with the life insurance provisions taking effect on February 1, 2020. In practical terms, a licensed producer recommending that you replace, convert, surrender, or otherwise alter an in-force New York life policy is required to act in your best interest, to have a reasonable basis for the recommendation, and to document it.
Two uses for that. First, if an agent is pushing a replacement or a particular conversion plan, you are entitled to ask what the basis for the recommendation is and to see it in writing. Second, it is a reminder that the agent recommending a conversion may be compensated differently depending on which permanent plan you choose, which is precisely the conflict the rule exists to manage. Ask directly.
The same skepticism applies on the settlement side. A legitimate process discloses who is compensated and how, provides written offers you can compare, and does not pressure. Anyone requesting an upfront fee, refusing to name the licensed provider making the offer, or telling you an offer expires in forty-eight hours is showing you a red flag. Our page on life settlement red flags lists the specific ones to watch for.
Sequencing: convert first, or sell the term policy as it is?
Two workable orders, with different tradeoffs.
Sell the convertible term policy as it stands. The buyer takes ownership with the conversion right attached and exercises it after closing, so the seller never funds a permanent premium at an advanced age. This is standard practice and usually the cleaner path. It requires runway: a settlement typically takes 60 to 120 days from application to funded escrow, so a conversion deadline closer than that will cause buyers to decline on timing rather than merit.
Convert first, then sell the permanent policy. Worth considering when the conversion menu contains a genuinely favorable plan or when the deadline forces action. The cost is carrying the permanent premium in the interim, which at older ages is not small, and the risk is converting into a plan that prices badly.
The mistake that costs the most is converting into whatever the agent suggests and asking about market value afterward. If a sale is under real consideration, get the conversion options quoted and get a preliminary read on how each would be valued before electing one. And never let the term policy lapse while a review is pending; once coverage ends there is nothing to evaluate and reinstatement generally requires evidence of insurability the insured may no longer have. Compare the paths at life settlement versus term conversion.
Who actually has a case, and what to send
The profile that produces offers is narrow and worth stating plainly. The insured is generally 68 or older. The death benefit is comfortably above $100,000, since fixed underwriting and closing costs put the practical floor there. The conversion privilege has at least four to six months left. And health has declined enough since the original underwriting that an independent life expectancy underwriter would score the case materially shorter than standard mortality. Serious impairments move the needle; well-controlled chronic conditions generally do not. Our summary of what affects a life settlement offer goes through the variables buyers actually weigh.
It is not a case when conversion has expired, when the insured is healthy, or when the coverage is still doing necessary work such as securing a business loan or protecting a dependent. Selling protection that is still needed, to solve a problem with a smaller solution available, is a bad trade and we would rather say so.
To get a preliminary answer, send the policy cover page, the carrier’s written statement of the conversion expiry and available conversion plans, and a short list of the insured’s current diagnoses and treating physicians. If the insured also owns permanent coverage, that is frequently where the real value sits; see our Equitable indexed universal life page in that case.
Pine Lake Life Solutions provides education and a free policy review. We do not purchase policies and are not licensed in every state. Whether a settlement is permitted where you live and who must be licensed to arrange one is determined by your own state’s insurance law, not by New York’s, even though New York supervises the insurer. Nothing here is legal, tax, or investment advice.
Frequently Asked Questions
How long does an Equitable term conversion privilege last?
It normally ends at the earlier of a stated attained age, commonly between 65 and 70, or a stated policy year, often 10 or 15 even on a longer level term product. That means it frequently expires well before the level premium period. Get the exact date in writing from Equitable’s service center rather than estimating from the term length.
Do I have to take a medical exam to convert?
No. Conversion is exercised without evidence of insurability, which is the entire value of the privilege. The permanent policy is issued at the insured’s attained age using the underwriting class from the original term application. Health matters only afterward, if a settlement is being considered, because that is what a buyer prices.
Why does the type of permanent policy affect what a buyer will pay?
Because the buyer must keep the converted policy in force until the death benefit is paid, and that cost varies by design. A guaranteed universal life contract with a no-lapse guarantee has a fixed, predictable carrying cost. A variable universal life contract depends on subaccount performance and rising insurance charges, so the buyer prices in the risk of having to fund more than planned.
My policy names MONY Life Insurance Company. Can Equitable process my conversion?
No. MONY Life Insurance Company was sold to Protective Life in 2013, so Protective services those contracts. MONY Life Insurance Company of America is different; it remained and became Equitable Financial Life Insurance Company of America, domiciled in Arizona. Read the exact company name on the face page, because sending a conversion request to the wrong carrier wastes weeks against a running deadline.
What is New York Regulation 187 and does it help me?
It applies a best interest standard to producer recommendations involving life insurance, with the life insurance provisions effective February 1, 2020. If a licensed producer recommends replacing, converting, or surrendering an in-force New York policy, they must have a reasonable basis for that recommendation in your interest and document it. You can ask to see the basis in writing.
Can a buyer convert the policy instead of me?
Yes, and it is standard when enough time remains. The buyer acquires the term contract with the conversion right attached and exercises it after closing, so you never fund a permanent premium. The process typically runs 60 to 120 days from application to funded escrow, so a conversion deadline arriving sooner than that will usually cause buyers to decline.
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Related Reading
- Can I Sell A Term Life Insurance Policy
- What Is A Term Conversion Rider
- Life Settlement Vs Term Conversion
- What Is Guaranteed Universal Life
- What Is Variable Universal Life
- Life Settlement Scams Red Flags
- What Affects A Life Settlement Offer
- Sell My Equitable Indexed Universal Policy
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.