Legal Definitions - perpetual policy

A perpetual policy is an insurance policy that remains effective without renewal until one of the parties terminates it according to its terms. This means that the policy will continue indefinitely until either the insurer or the insured decides to end it.

For example, a life insurance policy may be a perpetual policy that remains in effect until the insured person dies or until the policy is cancelled by the insurer or the insured. Another example is a property insurance policy that remains in effect until the property is sold or until the policy is cancelled.

Perpetual policies are useful for people who want long-term coverage without having to worry about renewing their policy every year. However, they may also be more expensive than policies that require renewal because the insurer is taking on more risk by providing coverage for an indefinite period.