Definition

A part of your policy that explains the conditions for renewing your coverage. It sets the rules for continuing your protection from year to year.

What to consider

  • Keep track of renewal dates and payment deadlines.
  • Set up reminders to avoid lapses.
  • Understand the process for reinstatement if coverage lapses.

Real world scenarios

  • If a policyholder misses a premium payment, the insurer may declare a lapse of coverage.
  • A small business experienced a lapse of coverage after failing to renew its group plan on time.
  • An individual’s coverage lapsed temporarily due to missed payment, causing a delay in benefits.

Related terms

Insurance & Financial Protection