Primerica Insurance term life, explain to me about the 2 year contestablity period?

Question

If a person dies, and didnot answer the question on application correctly how is that handled.

Answer 1

By insurance law in all states, the company can contest the payout of death claims during the first two years if the company has found that the applicant has made fraudulent claims, misrepresentation, or concealment of information.

The contestability period last for 2 years from date of issue. After that, the insurance law says that the insurance company can't contest (deny) the payout of death claim, except where the applicant has misstate his/her age or s*x. In this case, the insurance company will adjust the face amount of the policy, but still pay the death claim.

Here's some other information if the applicant commits suicide. If the person commits suicide during the first 2 years, the company will only refund the premiums to the beneficiary. If the person commits suicide after the first 2 years, the insurance company will pay the death claim.

Answer 2

Please tell me you do not have term insurance? Its a rip off term only pays out 1%. I can give you some in dept details about another way of obtaining life insurance if you want.

Answer 3

The contestable clause and suicide clause are the same with any life insurance company that sells insurance in your state.

You can find many companies with lower term rates than Primerica.

Answer 4

The  period of  2 years is from date of issue. After that, the insurance law says that the insurance company can't contest (deny) the payout of death claim, except where the applicant has made in inaccurate entries on their application. In this case, the insurance company will adjust the face amount of the policy, but still pay the death claim. It is always key the any paperwork submitted is verified for completeness and accuracy. The other thing to remember is that if no beneficiary was named the monies could be claimed by debtors.

Answer 5

In my understanding, the contestable period has to do with death relating to illness.  What this really does is protects the insured's family from having to provide proof of medical conditions many years after the policy was issued.  If the death is caused by injury, the company will pay unless they suspect fraud.  The 2 year period does not effect fraud issues.  For example, if the applicant says he does not pilot airplanes on the application, yet five years later the obituary says he was a pilot for 20 years, they may consider challenging the claim on the basis of fraud or intentional misrepresentation.

Find an Certified Financial Planner or attorney to help you.