Definition - What does Grace Period mean?
A grace period refers to the time mentioned in a contract after the due date where performance or payment can be made without paying any penalties. This is usually a short time period after the due date and if no payment is made during this period, the contract may get suspended.
Justipedia explains Grace Period
For example, a person fails to pay his or her insurance premium by the deadline, for example, a certain time period of usually a few days is given to make the payment. If there is no payment made during this time period then the insurance company might decide to cancel the insurance contract.