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The termination of a right or privilege due to inaction. In insurance, lapses occur on a policy if the policyholder fails to pay premiums. In this case, the right to receive the benefit lapses. In options, the contract lapses if the option is not exercised on or by the expiration date. In this case, the right to buy or sell the underlying asset lapses.


A lapse causes a policy, right, or privilege to end because the person or institution that would benefit fails to live up to its terms or meet its conditions.

For example, if you have a subscription right to buy additional shares of a stock at a price below the public offering price, you must generally act before a certain date. If that date passes, your right is said to lapse.

Similarly, if you have a life insurance policy that requires you to pay annual premiums, the policy will lapse if you fail to pay the premiums in time.

References in periodicals archive ?
Among the three segments of maintainers, lapsers and non-users, I will concentrate on the last two segments.
Further analysis of the budgeting behavioral data for each product or service category can identify three consumer coping segments: (1) category maintainers whose revenue productivity falls under the responsibility of the consumer retention manager; (2) category lapsers whose business growing contribution is the job of consumer re-acquisition manager; and (3) category non-users who can be sourced for business growing by the new customer acquisition manager.
Theres 87 percent of Metro Manila housewives who are maintainers, 13 percent lapsers and 0 percent non-users.