Usually yes, for a while, and how it works depends on which kind of policy you own.
On whole life, the provision is called automatic premium loan. Where it's elected on your contract, the carrier borrows the premium out of your cash value when a payment isn't made by the end of the grace period. It's a policy loan like any other, it accrues interest, and it keeps the contract in force. You don't apply for it and it happens on its own, which is the entire point of it.
On indexed universal life, the mechanism is different. An IUL has no required premium the way whole life does. It has monthly charges: cost of insurance, an administrative fee, and a percentage taken off premium coming in. As long as the account value covers those charges, the policy stays in force whether you send money or not. Stop paying on a well-funded IUL and the account value covers the charges and the policy keeps running. Stop paying on a thin one and the account value drains, and then you're in a grace period staring at a demand for enough premium to catch up.
Both of those are fine for a year. Neither is fine for ten. Cost of insurance rises with age on an IUL, and a whole life policy taking an automatic premium loan every year is a balance compounding against itself. What starts as a bridge across one bad year becomes the reason the policy fails in year fifteen.
So before you let it run automatically, look at the other levers, because most of them cost less. Finding premium money in a tight year is its own subject, and Carlo Viqueira and I gave a LIFE Pod episode to where that money comes from.
Cut the paid-up additions instead of the base premium. On a well-designed whole life policy, a large share of what you pay is a paid-up additions rider, which means extra dollars buying small chunks of fully paid-up insurance, and that rider drives most of the early cash value. It's usually flexible. Pay the base premium and skip the rider for a year and the policy is fully in force, still growing, and costing a fraction of the usual check. Base premium vs. paid-up additions explains the split.
Use the dividend to offset the premium. Whole life dividends can be applied directly against what you owe. On a contract that's been running fifteen or twenty years, the dividend can cover a meaningful piece of the bill and occasionally all of it. Call the carrier and ask what your current dividend would cover if you redirected it. Keep in mind dividends aren't guaranteed, and redirecting them slows your cash value growth, so it's a lever you pull and then put back.
Change the mode. If you pay annually and the lump is the problem rather than the total, switching to monthly spreads it across the year. It costs more over twelve months, and it can be the difference between paying and not paying.
Reduce the death benefit. A smaller face amount means a smaller required premium, permanently. The risk on a contract funded near the tax limits is that cutting the death benefit re-tests it and can turn it into a modified endowment contract, which makes loans and withdrawals taxable. Ask the carrier to confirm before they process it.
Take a straight policy loan and pay the premium yourself. Same effect as an automatic premium loan, except you pick the amount and the timing, and you can pay the interest out of pocket to keep the balance from compounding on you.
What I wouldn't do is surrender the policy to solve a twelve-month cash problem. Surrendering ends the coverage, can trigger tax on the gain, and you can't buy it back at the age and health you had when you bought it. Money got tight? Make these moves before you surrender is the full list.
Call the carrier's service line and ask one question: what are all the ways I can keep this policy in force this year without writing the full check. They'll answer, because a policy that stays on the books beats one that lapses. Then ask for an in-force illustration showing what each option does to the cash value ten years out, and pick with both numbers sitting in front of you.