What is the Contestability Period?
The Contestability Period is a timeframe, typically the first two years of a life insurance policy, during which the insurance company has the right to review and potentially deny a claim if it finds that the policyholder provided false or misleading information on their application. This period is designed to protect insurers from fraud or intentional misrepresentation.
During the Contestability Period, insurers can investigate claims and rescind coverage if they determine that important information, such as health conditions, was withheld. Once this period ends, the policy generally becomes incontestable, providing greater security for beneficiaries.