The ratio of the number of lapses in defined period to the corresponding number of renewal invitations. A policy lapses if the policyholder fails to pay premiums when they are due or fails to renew a general insurance policy when it expires.
Some policies terminate when a surrender value is paid.
However, the phrase lapse is sometimes used to include surrenders. A policy which is not renewed at the end of the term. The first claims from these sources may often only be apparent many years after the period of cover, eg asbestos, industrial deafness, RSI, etc. The underwriter who takes the lead in setting premium rates and agreeing policy conditions under a system of coinsurance. A document authorising the addressee to pay a specified sum to a party specified in the letter.