Which provision allows life insurance coverage to continue despite late premium payments?

The correct answer is the grace period because this provision allows the insured to maintain life insurance coverage even if premium payments are overdue. Typically, the grace period lasts for a specific duration, often around 30 days, during which the policy remains in force despite the absence of a premium payment. If the insured pays the premium during this time, the policy continues without interruption. This provision is crucial as it provides policyholders with a safety net against unintentional lapses in coverage while they are dealing with financial hardships or other issues that might prevent timely payments.

The reinstatement provision, on the other hand, typically applies when a policy has lapsed due to non-payment. It allows the policyholder to reactivate their policy within a certain timeframe by meeting specific criteria, such as paying any overdue premiums along with interest, but it doesn't provide coverage during the period of non-payment. The conversion option refers to the ability to change a term insurance policy into a permanent one, and the incontestability clause allows the insurer to deny a claim only if the policyholder has misrepresented information on their application within a certain period, usually two years, but does not affect premium payments.