Which term describes the mandatory provision that allows a policy to continue even when premiums are not paid?

The term that describes the mandatory provision allowing a policy to continue even when premiums are not paid is the grace period. A grace period is a specified period after the due date during which a policyholder can pay overdue premiums without losing coverage. This provision ensures that the policy remains in force, providing the policyholder an opportunity to catch up on missed payments without immediate repercussions, such as loss of coverage.

This is particularly important in insurance policies, as it serves to protect policyholders during times of financial strain or oversight. The grace period typically lasts for a set duration, often 30 days, during which the insurer is required to retain coverage, even if the premium has not been paid.

The other options refer to different aspects of insurance policies. A renewal option allows policyholders to renew their coverage under specified conditions, typically at the end of a term. Automatic cover generally refers to the temporary extension of coverage under specified events without additional processes. A non-forfeiture clause provides benefits to policyholders who stop paying premiums by allowing them to receive some value or benefits instead of losing all coverage. Each of these terms plays a role in the protection and continuity of insurance coverage, but the grace period specifically refers to the allowance for continuation of the policy despite non-payment