Asked by Angel Jordan on Jun 25, 2024
Verified
A(n) _____ clause in an insurance policy provides that after a policy has been in force for a specified length of time, usually two or three years, the insurer cannot contest statements made in the application.
A) appraisal
B) incontestability
C) subrogation
D) indemnity
Incontestability Clause
A clause in insurance policies that makes the policy non-contestable after it has been in force for a certain period, except under certain conditions.
Insurance Policy
A contract between an insurer and a policyholder that defines the claims which the insurer is legally required to pay.
- Gain insight into the essential elements and obligations of insurance policies, including indemnity, subrogation, and the clause regarding incontestability.
Verified Answer
SS
Suren SarveswaranJun 30, 2024
Final Answer :
B
Explanation :
The incontestability clause in an insurance policy ensures that after the policy has been active for a predetermined period, typically two or three years, the insurer cannot dispute the claims or statements made in the application. This clause is designed to provide certainty and security to the policyholder.
Learning Objectives
- Gain insight into the essential elements and obligations of insurance policies, including indemnity, subrogation, and the clause regarding incontestability.