YOU ASK:
What is the definition of Grace Period?
WE ANSWER:
The Grace Period, in insurance parlance, refers to the period provided the insurance or annuity to the policyowner or annuitant to pay for their insurance premium or annuity payments even after the due date has passed.
When a policyowner fails to pay the insurance premiums on time, the grace period kicks in and if the policyowner pays during the grace period, there will be no penalty or additional charge that has to be paid. During the grace period, the coverage would still be in effect as long as the premium payments are paid within that grace period.
The length of the grace period depends on the kind of policy. Some grace periods are as short as 24 hours or may go for as long as a month.
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