Sometimes people like you and me get busy with this fast life which results in forgetting some of the important things. Mr. Suresh who had buy insurance policy 2 years back which he is now forgotten about. He has not paid premium from 1 year. So now what option he has? Whether his earlier paid premium will be waste?
An insurance policy can lapse if premium is unpaid even after the end of grace period allowed by insurance company. However insurance company does leave option to revive the policy.
1) Once policy is lapse it generally can be revived within four years. Insurance company agrees to revive policy depends upon the age of insured.
2) Longer the insured takes to revive, more risky it becomes. In case of revival of insurance policy insurance company may insist insured to undergo medical examination.
3) It always better to revive insurance policy within 6 months of lapsing of policy. If in case policyholder tries to revive policy his/her policy after six month then he have to bare extra amount as penalty and interest.
4) Insurance companies also reject to revive the policy if they feel that the risk is high.
5) If your policy is less than 3 years old and something happens to you after policy lapses insurance company will not consider your claim. Insurance company in rare case may return your paid premium but will not pay sum assured. If policy is more than 3 years old then dependents can get some benefit.
If you want to avoid lapse and revival you should Setup ECS facility with your bank through which you can pay premium automatically. Don’t forget to update your corresponding address, contact number, email id so that insurance company can send you reminders. This will remind you about due premium and help you to avoid lapses.
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