A lapse means a life insurance policy is no longer an active contract due to missed premium payments.  A life insurance policy will lapse when both premium payments are missed and cash surrender value is exhausted if it is a permanent life insurance policy.  The term lapse refers to a “lapse in coverage”, meaning the life insurance contract will no longer pay a death benefit or provide any insurance coverage for the insured person.  A policy will only lapse after a grace period has passed, and most companies will allow their clients to reinstate their policies for a short period after the policy has lapsed without further underwriting.  Read on to learn how to reinstate your policy.  In this article we cover:

  1. Grace Period Must Happen Before a Lapse
  2. What to do if Your Policy Lapses
  3. Most Policies Can be Reinstated After a Lapse
  4. The Importance of a Reinstatement Period After a Lapse
  5. The Premium Payment Due May be Larger After a Lapse
  6. How to Avoid a Policy Lapse

A Grace Period Happens Before A Lapse

To prevent a life insurance policy from lapsing each and every time a premium payment is slightly late, every state in the country requires that a life insurance policy first goes through what is known as a grace period after a payment is missed.  This is a period of time (usually 30 days) where despite the missed payment, the insurance policy will still provide coverage and make a full payout if the insured dies.  To reach more about the grace period, read our reference here.

Only after the grace period has passed without receiving the due premiums can the life insurance company consider the policy to have lapsed.  Once a life insurance policy lapses the life insurance company is not under any legal obligation to pay the beneficiaries if an insured person passes away.

What to Do if Your Policy Lapses

You need to act as quickly as you can after a policy lapse.  You may be eligible for reinstatement.  Contact your agent as quickly as possible for advice.  If you can not get in touch with your agent immediately, call the home office of your life insurance company.  They will be able to advise you about the payment that you need to make, and the ways that you can make payment.  If you intend to send a check by overnight delivery, they probably have a separate mailing address that will allow for faster processing.  If you wish to send a wire, this is also an option and they will provide the wiring instructions.  Make sure to follow these precisely so that your account gets credited and not someone else’s.  You may be able to drop a check off at your local office, and the payment will be considered accepted on that day.  The key after any lapse is to speak to your insurance company as quickly as possible to discuss your options.

Most Policies Can Be Reinstated After Lapsing

For some period of time (depending on company and policy type) after a policy first lapses, the owner may have the option to reinstate the policy.  You want to make sure that you reinstate your policy as quickly as possible after a lapse.  Different companies have different rules for reinstatement and you could miss your window to reinstate your policy if you do not act quickly enough.

A reinstatement can usually be done with no underwriting within the first 30 days, and with limited underwriting after 30 days but for less than six months.  The limited underwriting usually requires that the insured person answers some health questions, and attests that no material changes in health have occurred since the policy was underwritten.  Lying on this questionnaire, if caught during the claims process, can negate a life insurance claim from being required to be paid.  Never lie on the reinstatement questionnaire or you may force your beneficiaries to forgo the benefits they were expecting.

The Importance of the Reinstatement Period After a Policy Lapse


The reinstatement period is very important to policy owners and insured persons for a couple of reasons.  The first reason is as discussed, the insured person may not need to go through the underwriting process if they accidentally miss a payment and let a policy lapse.  If a person has had a major health change, he or she may not necessarily be aware of the change.  As long as he or she doesn’t lie on the reinstatement form and can prove that they were unaware of any changes in health,  the insurance company will reinstate the policy and make a payout if a claim is filed.  The underwriting process may uncover more about a person’s health than they ever knew, for better and worse.  Avoiding underwriting when possible almost always leads to lower insurance premiums.

The second reason the reinstatement period is very important is that even with the same health rating, a new life insurance policy will always be more expensive than an old policy because the insured person has aged.  The older the insured person, the higher the rates will be, all else being equal.  The bottom line is: Reinstating a life insurance policy rather than taking out a new policy will save a lot of money.

Reinstatement Will Cost More Than One Month Premium

After a policy has lapsed, a larger payment must be made to reinstate the policy.  It is in the best interest of a policyholder never to let a policy lapse.  This extra payment is not a late fee, but it does signal to the life insurance company that a person is not going to constantly be letting a policy lapse.  The large payment will cover the policy premium due for at least a few months.

How to Avoid a Policy Lapse

The best way to avoid a lapse is to always make premium payments on time.  All major life insurance carriers offer the ability to automatically draft payments from your checking account to pay the policy on time every month.  This is a nice feature because it removes the need to think about life insurance premium payments every month, which is not at the top of most people’s priority lists.

Whole life, universal life, and variable universal life insurance policies will generally take the cost of insurance from the cash value in some way if a premium payment is missed.  While this can ease the burden for clients during times when it is not possible to make payments into the policy, clients must stay on top of the policy values.  If the value slips near zero and there are not sufficient funds to cover the cost of life insurance, the policy will lapse.

Term life insurance has no cash value.  Therefore when a premium payment is missed, the policy will immediately go into a grace period, and then lapse after the prescribed amount of time.  Always make a premium payment on time for a term life insurance policy, and do not miss payments.  Term life insurance can be easy to replace, but if the insured person loses coverage they put their beneficiaries in financial peril.

Insurance companies will always put out lapse notices to their client prior to the lapse taking place, and immediately after it has.  By doing something as simple as opening and reading your mail from your insurance company, you will be kept aware of any changes to your insurance policy’s status and avoid lapses.

A life insurance policy lapse means that life insurance coverage is no longer active.  No death claim payments will be made if an insured passes, no policy changes can be made, and there is no cash surrender value at this point.  To avoid lapse always make your scheduled payments on time to your life insurance company.

If your life insurance policy has lapsed and you would like to find the least expensive option for new life insurance coverage, use our quote comparison tool to save money on your next life insurance policy.


  1. Barbara A Jordan-Lyons

    What if your employer doesn’t pay their part of the premium, and your policy lapses. But they are still taking money out of your paycheck?

    1. Hi Barbara, I am guessing that you are referencing a group policy. An employer is not generally obligated to offer group life insurance to their employees, and they can cut this benefit if they wish. As long as they did not take money from your check to pay premiums after the lapse began, there probably isn’t much that you can do. If they are still taking money from your paycheck after the lapse, this is considered fraud and is illegal.

  2. What if a person had a policy that lapsed and died during the time it had lapsed, can you reinstate it by paying what’s due?

    1. If the death was within 30 days of the policy lapse, you have a chance. The insurance company is not required to pay after a lapse, by law. Even so, many will pay with death within 30 days of a lapse in order to avoid contestations. Outside of this you likely can not. You can check with the state insurance bureau for laws regarding policy lapse, in the State that the policy was issued in.

  3. what happens if the employee was removed from Site and havent worked from two months because he was very sick and his policy lapse

    1. If an employee was a part of a group plan, and the coverage ended because of termination of employment, the employer could add them again if they resumed work. If the policy has lapsed, you can always call the insurance company to see if their grace period allows them to reinstate coverage, but likely not once full lapse has taken place.

  4. Hi…what if my due date was last July 10 2019..and I haven’t paid it till now. Is my insurance policy considered lapsed already?

    1. Hi Evan. Usually, a life insurance company will give you a 30 day grace period before your life insurance policy lapses. Since it is now more than 30 days late, you likely do have a lapsed policy. You may still be able to reinstate the policy if you sign an affidavit saying that you have not had any material changes in your health. You will need to contact your insurance company to see what their policy is regarding reinstatement and what exactly what you will need to do to possibly reinstate the policy.

  5. I recently had a policy lapse after 17 years for missing a payment.
    The policy had $116,000 dollars of cash value. However after applying for reinstatement the insurance company refused this due to changes in my health..
    They offered me another policy at a lower payment and a higher benefit to placate me
    as they reviewed my reinstatement request . They then cancelled policy as a result of health concerns. Do I have any rights to demand reinstatement of the original policy. Thank you

    John F Sullivan

    1. Hi John. Unfortunately, it sounds like the life insurance company acted according to their rights within the contract. You should review the actual policy since it will spell out the grace period, lapse, and possible reinstatement. Because life insurance companies are required by law to provide a grace period where the coverage remains in force after a missed payment, they are not required to reinstate a policy after a lapse. They must treat your case according to their internal procedure for handling reinstatement the same way that they would treat any other similar case, however, it sounds like they did in this case. You should have received your cash value, and if reinstatement is not an option you can apply for a new policy. If you can not get coverage, you may need to apply to multiple companies to see if one is willing to issue the policy. Certain agents and brokerages specialize in high-risk cases. You can also investigate a guaranteed issue policy.

  6. What if the insured was hospitalized and never received notice of the missed premium payments and then the insured subsequently dies a few days after the lapse?

    1. Hi Ezi, unfortunately, the life insurance company is not obligated to pay. If the death is within a few days of lapse the life insurance company may still pay the claim. You should pursue a claim and research laws in the state of jurisdiction to ensure that there are no provisions for lapse while incapacitated. The life insurance company may pay, but likely is not bound to by the terms of the contract.

      1. Hi was supposed to pay my premium on 26th of April and i dint pay.. That’s means my policy is lapse?

        1. Not necessarily. Insurance companies are required to give a grace period under state law. Contact your life insurance company and see what you can do. You may also have options to reinstate the policy if it did lapse, you will just need to attest that you have not had any changes in your health.

  7. Hi Thomas,

    My gran had a policy that I was paying on her behalf for a long time, last year I fell on bad times in that I lost my job and I couldnt keep up with the payments, because she is on pension, I couldnt transfer the debit order to her, she gets a govt grant only. I am now working but it has been a while since the policy, is there anything I can do to try and get her covered again on the same policy. I dont know what to do

    1. Hi Amanda. The first thing that you should do is to contact the life insurance company that wrote the policy immediately to see if the coverage lapsed and to see if you have any options to reinstate it. You may if the coverage has not been lapsed for long, and your Gran has not experienced any changes in her health. If not, you will need to get a new policy. You can look at final expense plans if you don’t need more than $50,000 of coverage, or you can try to get a traditional whole life or term policy. It is best to compare quotes for people over the age of 50, because the price of the premiums can really become a factor.

  8. In Nov of 2014 my mother died. She was insured as a retiree of the state. There was a change over with insurance companies therefore subsequently we did not know which company held her life insurance and we were misdirected to the wrong company; which stated that she was not in possession of a policy. However a policy did exist and two months later in January 2015 no one had made a claim so the policy lapsed and it was termed out. Four years later after much thought and research It was discovered that after that switch over she did in fact have life insurance at the time of her death; is there any recourse in this case?

    1. Hi Robert. Yes! If your mother had an active policy at the time of her death, you will still be able to make a claim. You need to follow up with the correct life insurance company and file a claim. They will process it for you!

  9. Good day,
    My husband was sick the whole of last year, was bed bound. In October he was admitted the whole month and discharged in November, I was received a letter from his insurance company, which he was too sick to open, I got to open it later and realized that his policy has lasped, I didn’t understand the implication of that as I was focusing on my husband’s life, after many hospital visitations, he died in December. According to the letter, the policy lasped in October 19th and my husband died on the 16th of December. Will he get payout if I present the necessary documents showing his been hospitalized?
    Thank you.

    1. You can certainly try. The insurance company may not be legally obligated to pay the claim, but still may.

  10. Hi,
    Last premium paid on policy in 2014. Now policy status is showing lapsed.
    Revival is also not possible. So can i get the refund of the premium paid till date?

    1. Andrew @ LifeAnt

      Hi Saurav,
      No, you will not be able to get a refund for a lapsed life insurance policy, particularly one that has been lapsed for so long already. Consider that money lost at this point, and if you still want life insurance, you’ll have to buy a new policy.

  11. Hello, my husband has a $100,000 universal life policy that we’ve been paying monthly premiums since the 1990s – we’ve never missed a payment. We have AutoPay from out account and our regular premium was withdrawn as recent as yesterday. We found out looking through old mail which we though was junk that his MetLife policy was bought out and they were requesting we pay $120 per month instead of our regular $50 AutoPay amount. We contacted them recently and an agent said now the policy has lapsed. He is 64 years old on Social Security disability due to injury but is healthy, no diseases, and I am retired, only have my Social Security as well, cannot afford this high premium. What are our options?

    1. Andrew @ LifeAnt

      Hi Janet,
      Universal life policies are tricky for that exact reason, they need to be monitored to make sure that your monthly payment is adequately covering the premiums, otherwise it taps into your cash value and if that amount becomes $0, then your policy lapses. It sounds like it doesn’t have anything to do with MetLife, it’s just the nature of a universal policy. At this point, you’ll probably have to buy a different type of life insurance policy, perhaps a lower amount term policy.

  12. We had two term life insurance policies with a payroll deduction through my work. I retired in July and apparently was supposed to be notified by HR to do something to continue the polices as a retiree. I don’t remember seeing anything.

    I didn’t receive any correspondence from the life insurance company that we hadn’t been paying the monthly premiums. When I contacted them to ask about a bill they informed me we were no longer covered since I retired. Shouldn’t they have sent correspondence telling me to pay our premiums or to tell me what the status was before they cancelled us?

    1. Yes they normally will send a notice.

  13. What if your policy lapses because you cancel the policy because of the company…they added a policy which i did not apply for and I tried canceling that policy and they failed to cancel and I end up cancelling all my policy with them .is it possible for me to get all my money back?

    1. If the policy was taken out fraudulently, probably yes.

  14. Larry Finkemeier

    I have two life insurance policies each with a cash value of about $125,000 and death benefits of about $200,000 each. I have been paying for these for about 30 years thru my company. I now wish to take out policies on three other employees and quit paying for these policies as advised by my agent. He says that my policies will continue in force and the premiums will just be deducted from the cash values. He says that in the event of my death the policies will pay the total death benefit as of nearly $200,000 less the amount of cash values that have been used to pay for the policies. The home office sent me letters on the policies stating ‘since the premiums have not been paid as of due dates, they are in danger of lapsing’. In order for the policies to pay the insured amounts should I continue to pay these policies? I
    have the feeling the agent did not advise me of the best option. Please advise ASAP.

    1. Contact the home office immediately to review your options. If these are universal policies, they should pull from cash value automatically. If this is a whole life policy, you may need to instruct the insurance company to pay the premium with dividends or a loan against cash value. Either way, get it on a recorded line so that your policies do not surrender.

  15. My husband was diagnosed with colon cancer in 2018. Specifically February 22. Exactly 2 years to that date he was forced to retire. Company then stated that his life insurance would end. Well he ended up dying 22 days after signing retirement papers. I’ve since been told by many of his employees that if you die within 30 days that there’s a grace period in which he’d (I) be eligible for the life insurance policy. I am not eligible for SS survivorship benefits because I’m only in my 50’s. Any hope for me?

    1. Andrew @ LifeAnt

      Hi Cheryl,
      It sounds like there could be hope for you, although there’s no way of knowing without diving into the company’s policies. You should probably speak with somebody from your husband’s company’s HR department and ask for a copy of the policy and employment contract. If you run into further trouble, you could speak with an attorney.

  16. Hi, I wasn’t able to pay my premiums for 3 years because of having a bad time. Cannot contact my financial adviser, do not have any idea and actually do not understand my policy well. What happen to the previous premiums I have had paid? What is the best thing to do? Can I still reinstate? It’s a variable insurance. Thanks.

    1. Since this is variable insurance, the options are endless depending upon how well funded your policy was when you stopped paying premiums. It may have lapsed, it may still be in force, you may even have more cash value than the last time you looked, since the market has been up. You need to get in touch with your life insurance company and ask for the contact information for a local advisor.

  17. If a policy lapses, can an insurance company automatically take out a loan in the insurer’s name to pay the lapse premium without permission?

    1. Yes I have seen it done. The actual policy is a contract and it will define the rights to do this. Typically this is a good thing because it prevents a lapse.

  18. Thomas,

    My wife and I are in our early 50s and let both of our term life insurance policies lapse after several years of financial hardship. We’ve been without life insurance for 3 or 4 years but are both now working again and would like to shop for new insurance. My union offers discounted life insurance through a major carrier, in fact the same carrier we had when our last policies lapsed. Do you think we’ll have difficulty getting coverage through them or any other carrier at this point?

    1. How easy or difficult it will be for you to obtain life insurance depends upon you and your wife’s health. It is not difficult for a reasonably healthy person in their early 50s to get term life insurance coverage, or for someone with moderate health issues controlled by medication or care or diet. The discounted coverage through your union sounds like the best place to start since it will likely be the least expensive. If it is a group policy, you will not have trouble getting coverage.

  19. Hi I have an Equitable Modified Premium Whole Life Policy subscribe on 1993 face value $250,000. I paid all annual premiums until 2001 when I was informed that, with the accumulated money accrued, I did not have to send the money for the annual premium since there was enough money in the account to pay for the premium. Everything was ok until May 2020 when the company informed me that the policy has lapsed since they did not receive the annual premium. The notification arrived late and the policy lapsed and the automatically used the surrender cash value in the account to purchase extended term life insurance for a seven years period till 2027. I asked them why They did not subtract the annual premium from the account as it has been done all these years. I have asked them the reasons, and they answered with evasive and every time I ask the for the clarifications they put me off. At the moment of the lapse the net cash surrender value was $57,490, the annual premium was $3,750 and I had no loans. I wonder if I can ask for the surrender cash by cancelling the extended policy. I am disgusted by the company attitude. I wi help

    1. I’m not sure the answer to your question. I would ask for a supervisor. They likely are not trying to “give evasive answers”, but more likely the representative you spoke with on the phone was poorly trained and probably didn’t actually know the answer. I would escalate the question to a more competent person at the company.

  20. Hannelie Duvenhage

    Good day
    I have a funeral policy with avbob.
    My premium is deducted from my salary every month. Avbob claims now that after 16 years in 2004 my company did not pay some of my premiums but they can not specify the months and they did not contact me in 16 years. Now the amount that is owned to them is R1300 and they want me to pay it now. But they are still not giving me any proof. Please what can I do

  21. Althea vernal Powell

    Hi I have a life an death insurance policy that is lapse but I haven’t paid for about a year because my husband and I don’t have a job, do you think I can get back all that I paid before?

    1. No, I do not. If your policy is in a lapsed state, there is no value. If it was a term policy, there never was any surrender value. If it is a whole life policy, any value you had is now gone. Unfortunately, you will not get any money back I’m afraid.

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