Conversion vs. Portability – Continuing Protection after Coverage Ends

Group life insurance is one of the simplest and most accessible financial benefits available. In an increasingly complex financial world, it is a benefit that is easy to understand and appreciate. One of the trade-offs for the low cost of group life insurance is that it is not permanent. If an employee leaves their company for a new job or is laid off, coverage will end. While many employees will quickly sign up for new plans with another employer, others will not.

This may lead to gaps in an individual’s overall life insurance coverage. Fortunately, group life insurance providers typically include provisions in their policies that allow existing employees to convert to permanent, individual coverage or to temporarily continue their existing group term life insurance coverage. Which option fits best—“converting” or “porting”— depends on the life insurance needs of each employee.

For more information about conversion and portability, read our Inside Track educational paper.