Insurance Lapse Impact Calculator

Work out insurance lapse impact instantly with clear inputs, formula shown and shareable results.

About Insurance Lapse Impact Calculator

A lapsed policy loses its cover and, in the early years, most of the premiums paid. Reviving it costs the arrears plus interest and may require fresh medical evidence — but the cover restored per unit of revival cost is usually far better value than buying a new policy at your current age.

Formulas

Revival cost

Revival cost = Premium arrears x (1 + Interest rate %)

Value test

Cover restored per unit cost = Sum assured / Revival cost

Worked example

With the default values below, Insurance Lapse Impact Calculator returns Cost to revive the policy of $104,640.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Premiums paid before lapse: 240,000
Sum assured lost on lapse: 5,000,000
Arrears payable to revive: 96,000
Interest on arrears for revival: 9

Results

Cost to revive the policy: $104,640.00
Interest on unpaid premiums: $8,640.00
Premiums already paid and at risk: $240,000.00
Cover restored per unit of revival cost: 47.78

Step by step

1Values used
2Revival cost
3Value test
4Cost to revive the policy= 104,640.00
5Interest on unpaid premiums= 8,640.00
6Premiums already paid and at risk= 240,000.00
7Cover restored per unit of revival cost= 47.78

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
Indicative estimate. Revival terms, interest rates, windows and underwriting requirements are set by the insurer and regulator. Not insurance advice.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Indicative estimate. Revival terms, interest rates, windows and underwriting requirements are set by the insurer and regulator. Not insurance advice.

Frequently Asked Questions

How long is the revival window?

Commonly two to five years from the first unpaid premium, depending on the regulator and product. After that the policy cannot be revived.

Will I need a medical again?

Often yes, especially for larger sums assured or longer lapses. A deterioration in health can lead to revival being refused or loaded.