The short answer is … well, there is no short answer. State laws require insurance companies to provide a grace period, which is typically 31 days after the premium is due. Such a provision keeps the policy in force during that timeframe, even though the premium has not been paid. The consequences can be different for term insurance and whole life insurance, so each will be addressed separately.
Since there is no cash surrender value in term policies, non-payment of premium would cause the policy to lapse if not for the grace period provision. If the insured were to die during the grace period, the full death benefit (less the unpaid premium) would be payable. If the premium remains unpaid and death occurs after the 31st day, no death benefit is payable.
If the premium isn’t paid within 31 days from the due date, the insurance is no longer in-force. However, there is no interruption of coverage if the premium is paid during the grace period. During the subsequent 31 days, the policy can be reinstated as long as there have been no adverse changes in health. That can be accomplished by paying the overdue premium and completing a form affirming no changes in health.
If the premium is still unpaid after 62 days, the policy can still be reinstated, but it will normally require evidence of insurability, which, depending on age, length of time overdue, and insurance company, can entail anything from answering a few health questions to a full exam and lab work, or anything in between.
A whole life policy will work the same way, unless it has sufficient cash value to cover the overdue premium. But even with sufficient cash value, absent a feature known as the automatic loan provision, there could be adverse unintended consequences.
The automatic loan provision prevents a policy with sufficient cash value from ever lapsing. It accomplishes this by triggering a loan when the premium is overdue by 62 days. It is a very valuable feature to have, but it is usually not the default option; it must be elected. If you have a whole life policy, check it to make sure you have it (if you got the policy through me, it has it).
While the automatic loan provision can prevent a policy from lapsing, it does so by creating a lien against the death benefit. There is nothing inherently wrong with that, but it should be monitored to ensure that the net death benefit still meets your objectives.
The end result is that the grace period buys you time in the event you overlooked paying your premium. And while that is certainly a useful feature, the full premium will still have to be paid if you want the coverage to continue.