A group life contract that lapses because of nonpayment of premium will continue to cover...

A life insurance policy does not terminate immediately the moment a renewal premium is missed. The grace-period provision protects the insured by keeping coverage in force for the allowed grace period after the premium due date. If death occurs during that grace period, the insurer remains liable for the death benefit, although the overdue premium and any permitted interest may be deducted from the amount payable. New Jersey’s individual life insurance grace-period statute requires a grace period of 30 days, one month of at least 30 days, or four weeks for certain industrial policies, and states that the policy continues in full force during that period. Group life contracts follow the same core principle for nonpayment: coverage continues only during the grace period, not for an additional 30 or 45 days after it expires. Option A is therefore correct. Options B, C, and D incorrectly extend coverage beyond the legally protected grace window. Reference topics: Grace Period, Lapse for Nonpayment, Group Life Policy Continuation.