If you’ve recently lost your job or are planning to retire, you may be wondering what happens to your employer-provided life insurance. In many cases, individuals have what’s called a conversion right, a powerful option that allows you to maintain life insurance coverage after leaving a group plan. Our life insurance attorneys often help clients recover denied claims or enforce their conversion rights after they’ve been wrongfully denied coverage or never informed of this crucial benefit.
Group life insurance conversion rights are often buried in policy documents and overlooked by both employees and HR departments. When exercised correctly, they allow individuals to convert group life insurance to an individual policy without medical underwriting, meaning no health questions, no physical exam, and no fear of being denied coverage due to illness or preexisting conditions. But these rights are time-sensitive and insurers don’t always make the process easy.
What Is the Group Life Insurance Conversion Privilege?
The conversion privilege under a group life insurance plan allows a covered individual to convert their group coverage into an individual policy if their group coverage ends for certain qualifying reasons. Common triggers include:
Termination of employment
Retirement
Loss of eligibility due to reduced work hours
Employer terminating the group policy altogether
This option protects individuals who may not qualify for private life insurance due to medical conditions or age. Crucially, no evidence of insurability is required, and the insurer cannot deny coverage if the conversion request is made within the designated time period.
How Long Do You Have to Convert Group Life Insurance?
Timing is everything when it comes to converting your group policy. Most plans give you 30 to 60 days from the date your group coverage ends to apply for conversion. This window is known as the conversion period. If you miss this deadline, the right to convert is permanently lost.
Employers are supposed to notify employees of their right to convert coverage when group benefits end. Unfortunately, many fail to do so, leaving employees or their families in the dark until it's too late. If you were never properly informed of your conversion rights or if your claim was denied because of a missed deadline legal recourse may still be available.
What Is the Difference Between Conversion and Portability?
While both conversion and portability provide ways to continue life insurance coverage after leaving a group plan, they operate differently and have distinct implications:
Conversion:
Creates a new individual life insurance policy
Requires no medical exam or health screening
Premiums are based on your age at conversion (and often higher than group rates)
Coverage is permanent or term-based, depending on the insurer’s options
Must be elected within the conversion period, usually 30-60 days
Portability:
Allows continuation of group life coverage at group rates
Available for a limited time (typically 18–24 months)
Usually requires that the insured was actively employed before separation
May require continued payment of premiums without employer contributions
Not available under all group policies
In many cases, portability is available only to younger, healthier employees and may require ongoing eligibility criteria. Conversion, by contrast, is a legally protected right that exists even for individuals in poor health making it a critical option for those who can’t qualify for new insurance on the open market.
Denied Life Insurance Claims Due to Conversion Issues
Many denied life insurance claims stem from misunderstandings or mishandling of conversion rights. Insurers often deny claims based on:
Alleged failure to apply for conversion within the time limit
Employer’s failure to notify the insured about their rights
Disputes over whether the insured was eligible to convert
Death occurring shortly after job termination, before conversion was finalized
Confusion between portability and conversion options
Our law firm has successfully recovered benefits in cases where conversion paperwork was never completed, but the insured was misled by the employer or insurer. If you believe you or your loved one had a right to convert group coverage and the insurer is refusing to pay, we can help. If you want to learn how to appeal a life insurance claim denial in Delaware call us.
FAQ: Group Life Insurance Conversion Rights
What is group life insurance conversion?
It’s the right to convert your employer-provided group life insurance to an individual policy when your group coverage ends without a medical exam or health questions.
Who is eligible to convert group life insurance?
Employees, retirees, or former group members whose coverage ends due to job loss, retirement, or reduction in hours may be eligible. Some plans also extend conversion rights to dependents.
How long do I have to convert my group policy?
Most policies give you 30 to 60 days after coverage ends. This is called the conversion period. If you miss the window, the right is lost unless the employer failed to notify you properly.
What happens if I miss the conversion deadline?
You may lose the right to convert. However, if you were not informed of your rights or were misled by your employer or insurer, legal remedies may be available.
Is medical underwriting required for a converted policy?
No. Conversion does not require a medical exam or evidence of good health. This makes it an essential option for individuals with health conditions.
What type of life insurance policy do I get after conversion?
Most insurers offer a permanent individual policy, such as whole life, though options vary. The premiums are higher than group rates and based on your age at the time of conversion.
Can I convert only part of my group coverage?
Yes, many policies allow partial conversion. You may choose to convert the full amount or just a portion, depending on your needs and what the plan allows.
What is the difference between conversion and portability?
Conversion creates a new individual policy. Portability allows you to temporarily keep your group policy. Portability is not always available and may end after a set time.
Can an insurer deny a claim if conversion paperwork was never submitted?
Yes, but this denial may be challenged. If the employer or insurer failed to inform the insured of their rights, the court may allow the claim.
Do employers have to notify employees about conversion rights?
Yes. Many courts have held that failure to notify employees about their conversion rights can result in the employer or insurer being liable for the benefit.
Can beneficiaries recover the benefit if the insured died before converting the policy?
Sometimes. If the insured intended to convert and was within the conversion window, or if they were misled, beneficiaries may still be able to recover.
Are conversion rights governed by ERISA?
Yes, in most cases where the group plan is employer-sponsored. ERISA laws govern notice requirements and provide remedies when insurers act in bad faith.
Is it worth converting group life insurance coverage?
For people with health issues or those who cannot qualify for individual insurance elsewhere, conversion may be the only way to retain life coverage without underwriting.
What if my group plan didn’t offer conversion?
Most employer-sponsored life insurance plans are required to offer conversion options, but exceptions exist. Always request documentation before assuming your rights don’t exist.