During the contestability period, what can the insurer do if misrepresentations or concealment are found?

During the contestability period, what can the insurer do if misrepresentations or concealment are found?

• A. The insurer can investigate misrepresentation or concealment and deny claims during the period.
• B. The insurer must honor all claims regardless of misrepresentation.
• C. The policy automatically renews.
• D. The policy ends after two years.

Answer: (A)

During the contestability period, the insurer reviews the information in the application for accuracy. If misrepresentation or concealment is found, the insurer may deny a claim or even rescind the policy during that window. This period (often the first two years) protects the insurer from fraud or material misstatements. Once the contestability period ends, misstatements generally can’t be used to deny a claim, except in cases of fraud. The other options don’t fit because they imply the insurer must pay regardless, that the policy automatically renews, or that the policy ends after two years, none of which reflect how contestability works.

During the contestability period, the insurer reviews the information in the application for accuracy. If misrepresentation or concealment is found, the insurer may deny a claim or even rescind the policy during that window. This period (often the first two years) protects the insurer from fraud or material misstatements. Once the contestability period ends, misstatements generally can’t be used to deny a claim, except in cases of fraud. The other options don’t fit because they imply the insurer must pay regardless, that the policy automatically renews, or that the policy ends after two years, none of which reflect how contestability works.