The automatic premium loan provision helps prevent a policy from lapsing by:

a.Borrowing the premium from the named beneficiary
b.Using the policy's available cash value to pay an overdue premium
c.Reducing the death benefit to zero until payment resumes for the entire lapsed period
d.Automatically converting the policy to term insurance

Explicación

The automatic premium loan provision, if elected, draws on the policy's cash value to cover a premium that was not paid by the end of the grace period, keeping the coverage in force as a policy loan. It does not borrow from the beneficiary, does not zero out the death benefit, and does not convert the policy to term. This feature guards against unintentional lapse, though it does reduce the cash value and, if unpaid, the death benefit by the loan amount.

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Revisado por John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verificar)
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