In which of the following scenarios is a convertible term policy most useful?

A convertible term policy is particularly useful when the insured has undergone health changes. This type of policy allows the insured to convert their term life insurance into a permanent life insurance policy, typically without needing to provide evidence of insurability. If an individual experiences negative health changes, they may find it difficult or impossible to secure new life insurance coverage due to their altered risk profile. The ability to convert to a permanent policy ensures that they can maintain some level of life insurance protection despite their changing health, thus providing peace of mind and financial security for their beneficiaries.

In contrast, a scenario involving decreasing coverage does not specifically relate to the unique benefits of a convertible term policy. The option to convert is primarily valuable when facing health issues rather than adjusting the amount of coverage. Maintaining current premiums is also the opposite of what typically occurs when converting a term policy, as permanent insurance often comes with higher premiums than term policies. Finally, if an insured only needs temporary coverage, they might not take advantage of the conversion option, as they likely wouldn't need to convert to a permanent policy if they plan to let the coverage lapse after a set period.