Question: What are the reasons of lapsation of insurance policies? 

Answer: A lapse is generated by the policy holder. A policy on vehicles, health, home, and/or insurable personal property will lapse if you do not continue to pay the bill or pay it on time. There is usually a provision for reinstatement without lapse if you pay your back and present bill. In situtations where an Underwriter has flagged your account as "do not reinstate" your policy will lapse unless you pay the bill on time.\n\nIf it is a life insurance policy, there are provisions generally for the policy to pay itself. It will deduct the premium from your policy until the cash value is exhausted. It will then lapse.
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