premium-payment-lapse-handling.md

Uploaded 8/8/2026, 11:54:00 PM

# Premium Payment Collection and Lapse Handling

The Finance Team monitors premium payments through the Policy Administration System. When a payment is missed, the system automatically sends a reminder notice to the policyholder.

If payment is not received within 10 days of the due date, the Finance Team sends a formal lapse warning. If payment is still not received after the grace period, the policy lapses and the Finance Team notifies the assigned Agent.

Policy requires a minimum 10-day grace period before any lapse, per state insurance regulations. In practice, the Finance Team often gives an extra few days of leeway for policyholders who call in and explain the delay, before formally lapsing the policy.

Lapsed policies can be reinstated within 15 days if the policyholder pays the full outstanding balance, which is an exception to the standard new-application underwriting process.