A Lapsed Policy is No Laughing Matter, Even for Celebrities

A Lapsed Policy is No Laughing Matter, Even for Celebrities

Michael Jackson’s Lapsed Life Insurance Policy

In a new twist to the Michael Jackson death, Jackson’s aide allegedly allowed the $20 million life insurance policy to lapse. The family of Mr. Jackson is considering legal action against the assistant who they reportedly believe kept the cash that had been put aside for insurance. Because the final payments were missed it is reported that Jackson’s children, Prince Michael, Paris and Prince Michael II will now receive $2.5 million rather than $22.5 million.

Ontario law has grace periods with respect to non-payment of premiums for life insurance policies. The policy may provide for a longer grace period. There is no mandatory grace period for a disability policy but non-payment could trigger termination of a policy. There are strict requirements for termination that the insurer must comply with. In either case, don’t end up like Jackson’s family. Seek the advice of a lawyer familiar with this area. Incompetence can lead to disaster.

By Steven Muller LL.B, J.D, LL.M.

Vice-President, Share Lawyers

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