What Happens When Life Insurance Policy Lapses? 
When a life insurance policy lapses , it means that the policy would no longer pay the death benefit if death of the insured person would occur . Policies lapse due to non-payment ; whether by accident or on purpose . When the policy lapses , there is usually a chance to reinstate it by filling out some paperwork and making up for the missed premium . However , reinstatement requires that the insured person 's health has not changed from the health rating it was when the policy was originally purchased . If unable to qualify for reinstatement a new policy will be needed . 