Insurance Lapse

« Back to Glossary Index

An insurance lapse occurs when a policyholder fails to make the required premium payments on time, causing the insurance coverage to expire.

A lapse in insurance coverage can leave the policyholder vulnerable to financial losses and legal consequences if an accident or other covered event occurs while the policy lapses.

In some cases, an insurance company may be willing to reinstate a lapsed policy if the policyholder pays any outstanding premiums and meets certain other requirements.

However, it is generally best to avoid a lapse in insurance coverage by making timely premium payments or arranging alternative coverage.

« Back to Glossary Index