What happens if a policyholder does not pay the premium in a Variable Life Insurance policy?

When a policyholder does not pay the premium for a Variable Life Insurance policy, the policy typically enters a grace period. This grace period allows the policyholder additional time to make the premium payment without immediately losing coverage. The length of the grace period can vary by insurer but is usually around 30 days. During this time, the policy remains in force, and if the premium is paid, coverage continues without interruption.

If the premium remains unpaid after the grace period, the policy may lapse. This means that the insurance coverage would terminate, and the policyholder would no longer have the death benefit or any associated cash value protection. This mechanism provides policyholders with a safety net, avoiding immediate lapses in coverage due to a missed payment, while also conveying the importance of timely premium payments to maintain their policy in good standing.