A lapse is a gap in coverage, either because a policy expired and an insured did not renew the policy or the insured failed to make a premium payment and coverage was terminated. If other coverage is not obtained to immediately take effect, there is a gap in coverage during which there is no insurance for any losses. In automobile insurance, this may result in the insured being penalized by the Department of Motor Vehicles for having no insurance coverage, even if the lapse is for only one day.
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MEDICAL,USA: Expiration of an insurance policy because of nonpayment of the premium when it is due. Also referred to as lapsed policy .
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The cancellation of a policy due to the non-payment of the premium due.
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The expiration of forfeiture of an Insurance Policy by non-payment of due premium.
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US: The termination or discontinuance of an insurance policy due to nonpayment of a premium.