Additional Deposit Privilege

What Does Additional Deposit Privilege Mean?

An additional deposit privilege is a clause in a life insurance policy that allows the policyholder to make unscheduled payments in return for more benefits. This payment scheme is possible before the maturity or the expiration of the insurance policy.

Insuranceopedia Explains Additional Deposit Privilege

This clause is most suitable for people whose finances are compromised during the period in which they are supposed to make scheduled payments for their policy. The lack of a fixed schedule removes some of the financial pressure from the policyholder. They can pay the premiums at a different time so long as it is before the maturity date. However, if the policyholder has taken a loan on their policy, the payments go against the loan.