When Is A Life Insurance Policy Paid Up? 
A life insurance policy is paid up when you do n't owe any more premiums on the policy . At that point , all the obligation is on the part of the insurance company to pay you according to the terms of the contract , as your part in paying them has been completed . In a reduced paid up policy , you choose to quit paying premiums before the scheduled time , in exchange for a policy that has a lower face amount than originally agreed upon . 