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What is the difference between attained age and original age in term life conversions?

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Final answer:

Attained age refers to the age at which the policyholder converts their term life insurance policy, while original age refers to the age at which the policy was initially acquired. The difference between these two ages can impact the cost of the converted policy.

Step-by-step explanation:

In terms of life conversions, the difference between attained age and original age relates to the age at which the conversion takes place. Attained age is the age at which the policyholder decides to convert their term life insurance policy into a permanent life insurance policy. Original age, on the other hand, refers to the age at which the policyholder initially purchased their term life insurance policy.

For example, if a policyholder purchased a term life insurance policy at the age of 30 and decides to convert it into a permanent policy at the age of 40, the attained age for the conversion would be 40. The original age in this case would still be 30, as that was the age at which the policy was first acquired.

The difference between the attained age and the original age is important because it can affect the cost of the converted policy. Generally, the younger the attained age, the lower the premiums for the permanent policy. So, if a policyholder converts their term policy at a younger age, they may be able to secure lower premiums for their permanent coverage.

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