If an insured forgets to pay their Disability Income policy premium and files a claim, what is the most likely outcome?

When an insured forgets to pay their premium for a Disability Income policy, the most likely outcome is that the claim will be denied. This is due to the fundamental principle that insurance operates on the basis of a valid contract, which encompasses timely payment of premiums. If premiums are not paid, the policy can lapse, meaning the coverage is no longer in effect.

In the case of a Disability Income policy, if the policy has lapsed due to non-payment of premiums, the insurance company is not obligated to honor any claims made by the insured. This prevents the insurer from facing the risk of providing benefits when the insured has not maintained their financial responsibility as stipulated in the contract.

While there are provisions in many policies that allow for a grace period for premium payments, if the insured fails to remedy the payment during this time and subsequently files a claim, the insurer typically has the right to deny that claim on the grounds that the policy was not active.