What is a common requirement to reinstate a life insurance policy?

Reinstating a life insurance policy is often contingent on providing proof of good health. When a policy lapses due to non-payment of premiums or other reasons, the insurer typically requires the policyholder to demonstrate that they are still in good health before allowing the policy to be reinstated. This requirement helps the insurer mitigate the risk of insuring someone who may have developed health issues since the original policy was issued.

While appointing a new beneficiary might be necessary during changes in policyholder circumstances, it is not a standard requirement for the reinstatement process. Similarly, paying a penalty fee may apply in certain situations, but it is not a universal requirement. Lastly, renewing the policy annually pertains to policies that are set up as renewable rather than reinstating a lapsed policy. Therefore, the proof of good health is the most directly related requirement in the context of reinstating a life insurance policy.