When a policy owner fails to pay the premium within the grace period, the policy is terminated. This means that the coverage will end and the policy will no longer be in effect. However, if there are nonforfeiture values, the policy can still be utilized as reduced paid-up insurance. This means that even though the policy has lapsed, there is still some insurance coverage available. It is important to understand the terms and conditions of your policy to avoid any lapses and ensure continuous coverage.
