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Life Insurance Grace Period

Life insurance policies typically come with grace periods. If you have a policy but don’t pay your premium on time, you’ll continue to receive coverage as long as you pay the amount you owe within the grace period. Let’s dive deeper into what a life insurance grace period is and how it might affect you as a policyholder.

What is a life insurance grace period?

A life insurance grace period is a set amount of time after your premium payment is due, during which policyholders may make a premium payment without their coverage lapsing.1 It provides a cushion that can come in handy if you’re unable to pay your premium on time for any reason. The insurance company and policy you have can determine the length of your grace period.

How long does a life insurance grace period last?

In most cases, the grace period for life insurance will last 30 or 31 days.1 You can refer to your contract to find out what the grace period is for your particular policy.2

Do all life insurance policies have grace periods?

Insurance companies would like you to keep your coverage because it allows them to meet their business goals. Therefore, policies usually have grace periods. While you might be able to find a policy without a grace period, it’s uncommon.

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What happens if you don’t make a life insurance premium payment?

If you haven’t paid your life insurance premium and the grace period has ended, your policy will lapse. This means that if you pass away unexpectedly, your policy will no longer apply and your beneficiaries will not be entitled to a death benefit that you paid premiums for in the past.1

Reasons why a policyholder might miss a life insurance premium payment

You may miss a life insurance premium payment for several reasons, like:

  • You forgot to make your payment.
  • You lost your job.
  • You have to cover an emergency expense, such as a car repair or medical bill.
  • Inflation and rising costs have taken a toll on your budget.

Tips for making life insurance payments on time

Here’s how you can avoid missing your payments and prevent a lapse in your life insurance coverage:

Set up automatic payments

Most life insurance companies let you set up automatic payments from your bank account. If you switch banks, don’t forget to change your banking details.

Create reminders

Use a calendar to set reminders for your life insurance payments, whether it’s a desk calendar or one on your mobile device. Be sure to make a premium payment as soon as you receive the reminder.

Reach out to the life insurance company

If you know you can’t make your premium payments, contact your life insurance company. They might provide more flexibility with the payment schedule, especially if you’ve been a loyal customer.

Ask loved ones for help

Don’t be afraid to reach out to beneficiaries to find out if they can help you make your premium payments. You can always pay them back when you’re able to.

Avoid a lapse in your life insurance policy

A lapse in a life insurance policy will take away the added financial protection your beneficiaries would receive if you suddenly pass away. That’s why it’s important to make your premium payments on time and do whatever you can to prevent the policy from lapsing.

If you’re looking for life insurance, Aflac offers term and whole life insurance at rates that fit most budgets. Chat with an agent today to learn more.

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