Nonforfeiture Clause

Published: | Updated: April 17, 2018

Definition - What does Nonforfeiture Clause mean?

A nonforfeiture clause is an element found in permanent life insurance policies and long-term care policies. These clauses stipulate that the insured will receive some of the benefits or a refund of their premiums paid if their policy lapses as the result of a missed premium payment.

In most cases, the insured party will have to make premium payments for three years before they can benefit from a nonforfeiture clause.

A nonforfeiture clause is also known as a nonforfeiture provision.

Insuranceopedia explains Nonforfeiture Clause

If the insurance policy has been in force for a sufficient amount of time, the nonforfeiture values will come into effect either when the insured party's coverage is terminated after failing to pay or when they choose to surrender their policy.

Depending on the policy, previous payments are converted into a full payment for less coverage, the schedule of payments is changed, or the insurer may refund either a portion of the premiums paid or the entire amount.

Another nonforfeiture option available to the insured is to use the face value of the whole life insurance policy to purchase more affordable term life coverage.


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Whether you're just starting to look into life insurance coverage or you've carried a policy for years, there's always something to learn.

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