If you have a life insurance plan that has lapsed do not lose heart as you can very well revive the plan in just a few simple steps. Reviving a lapsed life insurance plan is easy and can even be done online, provided you have not waited too long since the policy lapsed. Even in that case, there are ways to revive it, so you should definitely try to revive it. Read on to know more about the ways in which you can revive a lapsed life insurance plan.
Time-lapse - Within the Grace Period
First and foremost, you need to see how much time has elapsed since the life insurance plan lapsed. If it has been less than a month, you probably still have the grace period to enjoy. Most insurance providers offer a grace period within which you can reinstate a lapsed plan.
If you are within this period, all you have to do is pay the premium and your life insurance plan will be revived. This is usually available for all types of life insurance plans including term insurance plans, endowment insurance plans, retirement plans, etc.
Time-lapse - Beyond the Grace Period
If however you have left the policy in a lapsed state for more than a month and the grace period is over, you need to complete certain formalities and then get the policy reinstated. This is a slightly complex process, but it is in no way impossible to revive such a life insurance plan. All you have to do is:
- Notify the insurance company - Your first step would be to notify the insurance provider. You need to tell them in detail about your policy and the fact that it has lapsed. Provide all the relevant information such as the policy number, your personal details, etc. The company will then initiate the revival process and tell you what documentation work is needed
- Undergo a medical test - In all probability, your insurance provider will ask you to go for a medical screening test before the life insurance plan is reinstated. If the results of the test show that your health conditions have changed and you have developed some medical conditions, your premium rate will change.
- Clear the pending premium - Next, you will need to pay the pending premium. If there is a late fee or interest that has been levied, you need to pay that as well. Check the exact figure with the insurer and then make the payment. You can do so online or you can do so by cheque.
These are routine steps that you can complete easily. If you have a good life insurance plan that you have maintained for years, do not just let it go waste by letting it stay lapsed. Pay the premium and get it revived and enjoy the coverage. If at all you want to cancel your life insurance coverage completely, you should do so formally by informing the insurance provider and completing the formalities. For certain types of life insurance plans, you may also get a surrender value. Make use of these facilities and get the best value out of your life insurance policy at all times.
The Bottom Line
You should never let a life insurance plan lapse. Keep an eye on the premium due date. If possible, set up an autopay option so that the payment is never missed and the policy never lapses. Remember, your family won't be able to make a claim even if the policy stays lapsed for one single day. And since you can never predict the future, you won't be able to tell what danger lies ahead of you. So buy a good life insurance plan, and keep it active. If however, your plan has lapsed for some reason, follow the guidelines mentioned above and get it revived at the earliest and stay covered in a continuous manner.