Question

What is the grace period in insurance policies?

a.

The period within which the policyholder can surrender the policy without penalty

b.

The period within which the policyholder can convert the policy into a paid-up policy

c.

The time granted by the insurer for premium payment without penalty after the due date

d.

The time granted by the insurer for policy renewal after the expiry date

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (c).The time granted by the insurer for premium payment without penalty after the due date Explanation:Grace period refers to the time granted by the insurer from the due date for the payment of premium, during which time the policy is considered to be in-force without any interruption as per the terms of the policy.

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Q. What is the grace period in insurance policies?
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