Question

According to the Time Limit on Certain Defenses provision, non-fraudulent misstatements made on the health insurance application may not be used to deny a claim after the policy has been in force for:

A) One year
B) Two years
C) Three years
D) Five years

Answer 1

Non-fraudulent misstatements on a health insurance application cannot be used to deny a claim after the policy has been active for two years, as per the Time Limit on Certain Defenses provision.

Step-by-step explanation:

According to the Time Limit on Certain Defenses provision, commonly referred to in the industry as the "incontestability clause," non-fraudulent misstatements made on a health insurance application may not be used to deny a claim after the policy has been in force for two years. This means that if an insurance policyholder mistakenly provides inaccurate information on their application without fraudulent intent, and the policy has been active for at least two years, the insurance company cannot use that information as a basis to deny a claim for benefits under the policy. After this two-year period, the policy becomes incontestable, provided that the premium payments are made, making it more difficult for the company to challenge the policy's validity based on application errors.