Grace Period

A grace period is the amount of time after a premium due date during which a policyholder may pay an overdue premium without the policy lapsing. Most life insurance policies provide a grace period of 30 to 31 days. During the grace period, the policy remains fully in force, including the death benefit. If the insured dies during the grace period, the overdue premium is typically deducted from the death benefit payout. After the grace period expires without payment, the policy lapses — though non-forfeiture options may apply. Automatic premium loan provisions can also prevent lapse by borrowing from cash value to pay premiums, if available.