BANKING AFFAIRS

Detailed explanation-1: -What is Lapsed Policy. Definition: The policy for which all benefits to the policy holder cease and is terminated due to non payment of premium amount on the due date or even after the grace period is called a lapsed policy.

Detailed explanation-2: -A life insurance lapse occurs when you stop paying your policy’s premium and the contractual grace period has expired. If you let your life insurance lapse, coverage will end. Depending on your policy, you might be able to reinstate a lapsed policy by meeting certain requirements.

Detailed explanation-3: -Lapsed policies are the life insurance policies for which no premium is paid for renewal either on the due date or within the grace period. All the benefits under the lapsed policies cease to an end due to non-payment of the premium.

Detailed explanation-4: -noun. an accidental or temporary decline or deviation from an expected or accepted condition or state; a temporary falling or slipping from a previous standard: a lapse of justice. a slip or error, often of a trivial sort; failure: a lapse of memory.

Detailed explanation-5: -Lapsation of a life insurance policy is discontinuation of premium payment by the policy holder during the period of operation of the policy, due to any reason other than the death of the policy holder.