What term describes the termination of a policy due to the policy owner's failure to pay the premium?

The term that describes the termination of a policy due to the policy owner's failure to pay the premium is "lapse." A lapse occurs when the policyholder does not make the required premium payments by the due date, leading to a loss of coverage. This situation reflects the contractual obligation of the policyholder to maintain their premium payments in order to keep the policy active.

Once a policy lapses, the insurance company is typically not liable for any claims that occur during the period of non-payment, and there may be a grace period during which the policyholder can still make a payment to restore coverage. Understanding this term is essential for managing one's insurance policies and ensuring continued coverage.

Cancellation, while similar, usually refers to the termination of a policy initiated by the insurer for specific reasons. Termination can be a more general term that refers to the end of a policy but does not specifically relate to the failure to pay premiums. Revocation typically involves the rescinding of a policy under specific circumstances and does not apply directly to non-payment of premiums.