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Five things to know about paid-up insurance policies

When a plan is changed into a paid-up policy, there is no future responsibility to pay regular premiums and can be a huge financial relief in difficult circumstances. All that you require to know about Paid-up insurance policy.
 

Written by Thelearnvine

1.A paid-up policy is one where the policyholder ceases paying monthly payments, yet continues to enjoy partial insurance coverage.
 

2.When a plan is changed into a paid-up policy, there is no future responsibility to pay regular premiums and can be a huge financial relief in difficult circumstances.
 

3.The policyholder or beneficiaries do not get the policy’s initial coverage, and it is reduced to the extent of the premium payment that has been paid.

4.Some insurance carriers levy surrender charges or penalties to change to paid-up policy.

5.The paid-up function also helps minimize lapsation of policies when it’s tough to pay the premium.


 

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