Avoid it by taking advantage of your policy’s grace period or accumulated cash value.
You can’t predict drastic changes to your life circumstances or financial health. If you find yourself unable to cover your life insurance premiums, there are several options that may help you maintain coverage and hold on to your policy.
What happens if I can’t pay my life insurance premium?
If you fail to pay your life insurance premium, there’s a chance your policy could be canceled. The repercussions that follow a lapse in payment depend on your provider and the type of life insurance policy you hold.
While some providers may cancel your policy outright, others may offer a grace period in which you can submit a late payment to keep your life insurance coverage.
In fact, there may be several options you can exercise to keep your policy in good standing.
What options are available to me that will allow me to keep my coverage?
By missing a premium payment, you put your policy at risk. But if you’re having trouble keeping up with payments, there may be something you can do.
One of these options may help you hold onto your policy while you reassess your finances:
What can I do to avoid missing payments in the future?
If you’re worried about potentially missing a payment in the future, there are several ways to keep your payments on track.
Consider paying your premium quarterly, semi-annually or annually. Fewer payments may help you stay on track of your payment schedule. As an added incentive, many providers offer discounts between 2% to 8% for those who opt for annual payments. You’ll save upfront on administrative fees while eliminating the headache of a monthly payment schedule.
Or, simply automate the process with automatic monthly withdrawals to ensure your premiums are paid on time.
While missing a life insurance premium payment puts your policy at risk, there are things you can do to maintain your coverage.
If you’re having trouble paying for your policy, explore your rates with additional providers before you cancel your policy outright.