What is reinstatement in life insurance?

• A. Restoring a lapsed policy by paying past due premiums and providing evidence of insurability within a specified period.
• B. Voluntarily surrendering the policy in exchange for its cash surrender value.
• C. Extending the policy's term automatically.
• D. Increasing the death benefit without underwriting.

Answer: (A)

Reinstatement means bringing a lapsed life insurance policy back to active status and making it as if it hadn’t lapsed, within a set timeframe. To do this, you typically must pay all overdue premiums plus interest and may need to provide evidence of insurability to confirm your health hasn’t worsened since the policy was issued. If there’s an outstanding policy loan, you’ll usually have to repay the loan (and interest) to reinstate. Once approved, the policy resumes with its original terms—death benefit and riders—though underwriting could affect future premiums if your health has changed. This is distinct from surrendering the policy for its cash value, automatically extending term, or increasing the death benefit without underwriting.