Lapsed Policy

Lapsed Policy

The termination of an insurance policy due to inaction on the part of the policyholder. In general, lapses occur if the policyholder fails to pay premiums. In this case, the right to receive the benefit if an insured event occurs ceases to exist.
References in periodicals archive ?
About 20 minutes after the collision, Whittecar's husband renewed the lapsed policy on her car and she filed a claim for the damage to her car the next day.
com launched the self- inspect video feature on its app, which makes inspection and the related documentation a matter of few hours and helps the lapsed policy renewed faster than ever.
This happens because policy owners who do not pay the required premiums may have a lapsed policy following the end of the claim.
However, policyowners can resuscitate a lapsed policy if the insured meets certain tests and the policyholder puts the insurer back to the financial position it would have been in had the policyowner never allowed the policy to lapse.
For the client, a lapsed policy can be a devastating shock and be viewed as a broken promise.
If you have a lapsed policy and a bad insurance credit score, you'll probably pay much more than someone with a lapsed policy and a healthy credit history, Suarez says.
The firm said that the facility would enable customers to reinstate a lapsed policy and pay their premium online.
Mostly, a lapsed policy can only be revived by payment of due premiums along with applicable interest and "declaration of good health" by the policy-holder.
Between incurring penalty charges and losing life insurance coverage due to a lapsed policy, the tendency would be just to lose the policy coverage.
Renewal of a lapsed policy can cost you an extra 20 percent for several years.
If the insurance policy lapses due to nonpayment of the premiums or the exhaustion of the cash surrender value or investment fund, the policy owner does not have a deductible loss for any remaining basis in the lapsed policy.
Young breadwinners simply cannot afford adequate protection with whole life insurance and, typically, end up either grossly underprotected with a lapsed policy or both.