Which type of insurance allows an employee to convert to individual coverage after termination of the group plan?

The option that correctly identifies the type of insurance allowing an employee to convert to individual coverage after termination of the group plan is annually renewable term insurance.

This type of insurance is specifically designed for situations where coverage can be renewed annually without the need for medical underwriting, making it a suitable choice when transitioning from a group plan to an individual policy. Employees often find themselves needing coverage after leaving a group plan, and the ability to convert to an individual policy ensures continuity of coverage without the potential denial due to health conditions that could occur with other types of insurance.

In contrast, term life insurance generally covers a specific period and does not inherently include a conversion feature. Whole life insurance and universal life insurance, while they can offer lifelong coverage and might have cash value components, are not typically associated with automatic conversion options from group plans.