What is a 2 year contestibility period in life insurance?

Question

What is a 2 year contestibility period in life insurance?

Answer 1

The insurance company basically delays payment for 2 years without any good reason.  In other words they take their time in making a determination about weather to pay or not regardless of the COD (Cause of Death) being natural causes.  Don't let them talk you into that...they only need 90 days to figure out whether there was fowl play or not.  PEACE!

Answer 2

Yep, what others have written is correct.  Basically, after two years your insurance policy is obligated to payout if you misled them on the application.

Learn more about life insurance here:

http://www.ohioinsureplan.com/index.php/...

Answer 3

If you die within two years of the policy being issued, they can go back and verify the information you put on your application.

If you lied or forgot something (like, oops, I forgot I have cancer or oops I forgot I smoke) then they don't pay out.

Answer 4

Two years that the insurer can look back to make sure there were no "wrong-doings" on the application.  

For example:  Bob takes out life insurance, as a result of a material misrepresentation(he lies on the application)....the insurance company only has two years to "take-back" this promise to pay in the even of Bob's death.  

People always look at this from the suicide perspective.  If an insured commits suicide within the first two years of a life insurance policy, more than likely the insurance company will utilize their right to "contest" the policy.  In the event of a contest, premiums will be refunded to the beneficiary or possibly the the insured's estate.

Answer 5

Thebigm, is completely wrong.

The Contestability Period is the time period during which the insurer is not obligated to pay a claim (usually two years), because of material misrepresentations found in the application. A policy becomes "incontestable" when the contestability period is over

Basically if you die from a condition you willingly failed to disclose on the application within 2 years of the policy date the claim will be denied and the premiums will be refunded.  If you die anytime after 2 years the policy will pay even if you lied on the application.

If die from a heart attack one month after you buy the policy and there was no know evidence of a heart problem the policy will pay.

Answer 6

Broker are right again and this protect the insurance company for any on purpose fraud or occultist reason.