What type of insurance is a policy that has changed to provide coverage with a reduced face amount after the conversion?

The correct answer, which pertains to a policy that changes to provide coverage with a reduced face amount after conversion, is related to whole life insurance. When a policyholder chooses to convert a term life policy to a whole life policy, and the face amount of the policy is reduced, this scenario typically refers to "whole life with reduced face amount."

In the context of insurance, when a term policy is converted to a whole life policy, it allows the policyholder to retain some benefits of permanent coverage, albeit at a lower death benefit. This option is beneficial because it provides lifelong coverage while accommodating the policyholder's needs for reduced coverage possibly due to changes in financial circumstances or decreased insurance needs.

Extended term insurance, which may provide coverage without any cash value for a specified period, does not involve a conversion to a whole life policy. Term insurance typically provides coverage for a specific period and does not accumulate cash value or get converted with a reduced face amount, while term life with guaranteed renewability allows policyholders to renew their term policies without additional proof of insurability but does not affect the face amount in the context described.

Thus, "whole life with reduced face amount" accurately describes the scenario presented.