Yes, a North American Company for Life and Health term life policy can be sold in a life settlement, but with term there is almost always one extra step first: the policy usually has to be convertible, and the conversion privilege has a deadline. Term insurance builds no cash value. On its own it is a pure promise to pay if the insured dies during the term, which means there is nothing for a buyer to hold long term. The conversion privilege written into most term contracts is what turns that promise into a permanent policy a buyer can actually own.
North American Company for Life and Health Insurance was founded in Chicago in 1886 and is a member company of the Sammons Financial Group, whose parent Sammons Enterprises is employee-owned through an ESOP. As of 2026 it still issues new individual life insurance rather than sitting purely in runoff, and no demutualization ever distributed shares to policyholders. Verify who services your specific contract, along with the carrier’s current A.M. Best rating and service phone number, directly with the company, since blocks can be reinsured over time.
The most important thing on this page is the clock. Conversion windows expire by age, by policy year, or by whichever comes first, and once the window closes it does not reopen. If your term coverage is nearing the end of its level period or the insured is approaching the conversion age limit, read the schedule page today. Pine Lake Life Solutions is not affiliated with North American or the Sammons Financial Group, and nothing here is legal, tax, or investment advice.
In This Article
- Yes, and the Carrier Does Not Approve or Deny the Sale
- Find the Conversion Privilege on Your Schedule Page
- Why an Expiring Conversion Window Is Urgent
- What Happens When the Level Term Period Ends
- Documents to Gather
- How the Transaction Runs on a Term Policy
- Group and Employer Term Coverage Is a Separate Case
- Who Qualifies, and What to Do Now
- Frequently Asked Questions
Yes, and the Carrier Does Not Approve or Deny the Sale
The Supreme Court’s 1911 decision in Grigsby v. Russell established that a life insurance policy is transferable personal property. That holding covers every carrier and every product type, term included. The buyer purchases the contract from you and takes over the premiums.
The term wrinkle is not permission. It is economics. A buyer paying you a lump sum today needs a policy that will still exist when the insured dies, and level term expires. So the transaction usually runs in a specific order: confirm the policy is convertible, agree on terms, exercise the conversion, and transfer ownership of the resulting permanent policy. Some buyers will fund the conversion cost as part of the deal, and how that is handled should be spelled out in writing before you sign anything.
Find the Conversion Privilege on Your Schedule Page
Pull the contract and look at the schedule or specifications page and the riders list. You are hunting for language about a conversion or exchange privilege, and specifically for the limit: many term contracts allow conversion until a stated attained age, or until the end of a stated policy year, whichever comes first. Some allow conversion only into a specific product the carrier designates at the time, not into anything you choose.
Then call the policyholder service number and ask three questions plainly. Is this policy convertible today, yes or no. What is the last date conversion can be exercised. Which permanent products is it convertible into as of 2026, and what is the premium at the insured’s current age. Ask for the answer in writing. Conversion normally requires no new medical exam, which is exactly why it matters so much for an insured whose health has declined.
Why an Expiring Conversion Window Is Urgent
Health is the main driver of a life settlement offer. An insured whose health has worsened has a shorter estimated life expectancy, which means a buyer expects to pay premiums for fewer years and therefore pays more for the policy. That is the uncomfortable arithmetic of this market.
Here is the trap. The insured whose health has declined the most is often the person who can no longer qualify for new coverage, so the conversion privilege is the only route to a permanent policy. And that privilege usually expires around the same stretch of life when it becomes most valuable. Once the deadline passes, the term policy simply runs out at the end of its level period, or renews at annually increasing premiums that are usually unaffordable, and decades of paid premiums produce nothing. If the deadline is within a year, treat a policy review as time-sensitive.
What Happens When the Level Term Period Ends
Most level term policies do not simply vanish on the last day of the level period. They typically enter an annually renewable phase where coverage continues, but the premium is recalculated each year at the insured’s attained age. Those renewal premiums escalate steeply, often to multiples of what you have been paying, which is why the vast majority of term policies lapse rather than pay a claim.
Check your schedule page for the guaranteed renewal premium table, or ask the service center for it. Two facts are worth knowing before you make any decision: the final age to which the policy can be renewed at all, and the premium at each of the next few attained ages. If the policy is convertible and the numbers are ugly, conversion is the alternative worth pricing, and a settlement may be what makes conversion affordable.
| Item to Confirm | Where to Look | Why It Decides the Outcome |
|---|---|---|
| Is the policy convertible | Schedule page or conversion provision | Without conversion, a term policy usually cannot be settled |
| Last date to convert | Provision language, confirmed in writing by the carrier | The window closes permanently and does not reopen |
| Products it converts into | Carrier service center, current 2026 list | Determines the premium a buyer would have to carry |
| End of level premium period | Schedule page | After this, premiums typically rise every year |
| Guaranteed renewal premiums | Renewal premium table | Shows the real cost of simply keeping the term policy |
| Rider versus base coverage | Riders list on the schedule page | Riders may convert under different rules or not at all |
Documents to Gather
Begin with the policy cover page or schedule page showing the issuing company, policy number, face amount, issue date, level term period, and the insured. That single page is enough for a free, no-obligation policy review.
Beyond that, term files are thin by nature, so the useful additions are the conversion provision language from the contract, a written statement from the service center confirming convertibility and the conversion deadline, an illustration of the permanent product the policy converts into at current age, and the renewal premium table. If a rider provides part of the coverage, note whether the rider itself is convertible, because riders and base coverage sometimes follow different rules. Medical records come later and are ordered by the buyer’s underwriter with your written authorization.
How the Transaction Runs on a Term Policy
The order of operations differs from a permanent policy sale. First, a free review from the cover page. Second, verification of convertibility and the deadline in writing from the carrier. Third, the application and HIPAA authorization so the buyer can order records and life-expectancy estimates. Fourth, an offer in writing, which should state clearly who pays the conversion premium and when. Fifth, conversion is exercised. Sixth, contracts, independent escrow, and the change of ownership on the converted policy, with escrow releasing your funds only after the carrier confirms.
Expect 60 to 120 days overall, and note that the conversion step can add time because the carrier must issue a new permanent contract. Never transfer ownership on a promise of later payment. For how the steps fit together generally, see how the process works.
Group and Employer Term Coverage Is a Separate Case
If your term coverage came through an employer or an association rather than as an individually issued policy, the rules change. Group life certificates typically include a conversion right that must be exercised within a short window after coverage ends, commonly about 31 days from the date employment or membership terminates. Miss that window and the coverage is generally gone with no residual value.
If a retirement or a layoff is on the horizon, ask the benefits administrator for the conversion notice and the exact deadline in writing before the last day of coverage, and confirm what individual product the certificate converts into. Group conversion premiums are often high because they are not medically underwritten, which is precisely why they are available to people who cannot buy new coverage. A converted group policy can be reviewed for a settlement like any other permanent policy.
Who Qualifies, and What to Do Now
Buyers typically want an insured around 65 or older, or younger with significant health conditions, and a death benefit of $100,000 or more. For term specifically, add two requirements: the policy must be convertible, and the conversion window must still be open. If either fails, a settlement is usually off the table, and a review will tell you that in short order at no cost.
Send the policy cover page and, if you have it, the page describing the conversion privilege, for a free policy review. Or call (305) 209-7183, especially if a conversion deadline is close. If you also hold permanent North American coverage, see our guides to selling a North American whole life policy or a North American universal life policy.
Frequently Asked Questions
Can a term life policy really be sold?
Yes, but usually only if it is convertible and the conversion window is still open. Term builds no cash value and expires, so buyers generally require the policy to be converted to permanent coverage as part of the transaction. If the policy is not convertible, a settlement is normally not possible.
How do I find out whether my North American term policy is convertible?
Check the schedule page and the conversion provision in your contract, then call the policyholder service number and ask for written confirmation. Ask three things: is it convertible now, what is the last date to convert, and which permanent products it converts into as of 2026.
Does conversion require a new medical exam?
Conversion privileges are normally exercisable without new medical underwriting, which is why they matter so much when health has declined. The premium is based on the insured’s attained age, so it will be substantially higher than the term premium. Confirm the specific terms with the carrier.
Who pays for the conversion?
That is negotiated. Some buyers fund the conversion premium as part of the purchase, and some expect the seller to convert first. Whatever the arrangement, it should be stated in writing in the offer before you sign anything.
My term policy is almost at the end of its level period. What happens?
Most level term policies continue on an annually renewable basis at premiums recalculated at the insured’s attained age, and those premiums escalate sharply. Ask the service center for the guaranteed renewal premium table and the final renewal age so you can see the real cost of keeping it.
What about term coverage I got through my employer?
Group certificates usually carry a conversion right that must be exercised within a short window after coverage ends, commonly around 31 days from termination of employment. Ask the benefits administrator for the notice and deadline in writing before your last day. Once converted, the policy can be reviewed like any other permanent coverage.
How much could a converted term policy sell for?
The same market ranges apply once it is permanent coverage: generally 10 to 35 percent of face value, with the GAO study GAO-10-775 finding settlements paying roughly four to eight times cash surrender value. The buyer also weighs the converted policy’s premium, which can be high at older ages.
What should I send for a free review?
The policy cover or schedule page showing the insurer, policy number, face amount, issue date, and term period, plus the conversion provision if you have it. There is no cost or obligation. If a conversion deadline is near, call (305) 209-7183 rather than waiting.
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Related Reading
- What Policies Qualify For Life Settlement
- How It Works Policy Options
- Education Center
- Cash Surrender Value Life Insurance
- Sell My North American Whole Life Policy
- Sell My North American Universal Life 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.