For how long does a life insurance policy remain in place if one defaults on it? If one hasn’t paid on a $100,000 life insurance policy for a number of months, it is kaput, correct?
The person in question is not living in the house where it was originally taken out, so she would not have received any notices, etc.
There’s usually a grace period of thirty days past the due date of a payment. Past that mark, the policy will almost certainly have lapsed - for a term policy, anyway.
If it’s a whole life or universal life policy that was in place for a long while, then it’s possible that there was enough cash value built up to keep the policy from lapsing, but I wouldn’t hold my breath.
Usually there’s 30 days grace beyond the due date and then it lapses, i.e. goes out of effect. Often, for say, a year after that you can get the policy re-instated with payment of all back premiums, sometimes only once over the life of the policy. Unless this was provided for specifically in your policy, your insurer is under no obligation to do this, and will only do so if it’s in their interest. It should be noted that if insured is dead, it’s most certainly not in the insurer’s interest to reinstate and then instantly pay the claim. Underwriting (health questions / checkup) will sometimes be required for a reinstaement.
As mentioned, if the policy had dividends or a cash value, those may be paying the premium for you even if you’re not sending a check and the policy will remain in force so long as those funds last.
Insurance is a heavily regulated industry. What state are you asking about?