Which provision states that after two years in force, a misstatement cannot be used to deny a claim?

Which provision states that after two years in force, a misstatement cannot be used to deny a claim?

• A. Grace Period
• B. Free Look
• C. Reinstatement
• D. Incontestability

Answer: (D)

The key idea is the incontestability clause in life insurance. After the policy has been in force for two years, the insurer generally cannot deny a claim or void the policy based on misstatements in the application, as long as there’s no fraud and premiums are paid. This protects the insured and ensures claims are paid once the policy has stood the contestability period. The other provisions deal with premium deadlines (grace period), giving the policy owner time to review or cancel the policy (free look), or restoring a lapse (reinstatement); they aren’t about preventing claim denial after two years due to misstatements.

The key idea is the incontestability clause in life insurance. After the policy has been in force for two years, the insurer generally cannot deny a claim or void the policy based on misstatements in the application, as long as there’s no fraud and premiums are paid. This protects the insured and ensures claims are paid once the policy has stood the contestability period. The other provisions deal with premium deadlines (grace period), giving the policy owner time to review or cancel the policy (free look), or restoring a lapse (reinstatement); they aren’t about preventing claim denial after two years due to misstatements.