Getting a life insurance policy and dealing with claims can be stressful enough but there are also some strict clauses that make up a policy.

But guess what: 

Once you understand them, you will be able to make a more informed buying decision when it comes to your life insurance.

incontestability clause

In this guide, we’ll break down the incontestability clause in insurance and discuss what it means for you. 

​In This Article



What Is an Incontestability Clause in Insurance? 

In "Plain English" - it's a clause that stops the insurance company from denying your claim after you have had the policy for two years or more. 

Essentially the insurance company could contest your death and deny the payment of your claims to your beneficiary.

However, they can't do anything illegal and two years is not as long as it sounds. 

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How Does It Affect Life Insurance? 

Although you may assume that your life insurance policy will always pay out the death claim in full, this is not the case.

Your insurer may try to find ways to deny you the full payment.

One common way they may deny payment is to allege that the insured person misrepresented or failed to disclose relevant information upon purchasing the policy.

However, in the U.S., the incontestability clause in life insurance may prevent your insurance company from contesting the claim after a set period following the policy approval. 

How Long is an Incontestability Period?

The period an insurance company has to contest your claim is usually two years, though this period in some states is only one year.

The contestability period takes effect on the first day of your policy.

If upon investigating, the insurance company finds any information that proves you lied on your application they can cancel the policy or refuse to pay out the death claim.

After two years of having your policy it will enter the incontestability period.

Does the Incontestability Period Protect Me?

Unfortunately, no. If you die during the first one or two years the policy is in effect, the insurance company can still contest your death claim.


This is especially true if they believe that the owner or insured of the policy does one of the following upon applying for insurance:

  • Provided a fraudulent statement when applying for insurance
  • Fails to disclose necessary information when applying for insurance

What Can the Insurance Company Contest?

Believe it or not, contestability issues actually became a concern in the mid-1800s.


Insurers abused the law and refused to pay out claims due to simple errors that policyholders had made while filling out the application.

Contestability is a common way in which insurance companies can game the legal system and prevent your or your loved ones from getting financial security while grieving.


Some common areas that the company may claim you misrepresented are:


But there also many legally gray areas that you must consider.


For example, some legal scholars have discussed whether it constitutes fraud not to disclose the results of genetic testing before applying for life insurance.


If you have any questions about potentially fraudulent activity while applying for insurance, contact a licensed insurance attorney.

Finally, it’s important to reiterate:


If you die after the incontestability clause period, the insurer cannot deny your beneficiaries claim because the policy would now be considered incontestable — hence the name of the clause.

Are There Any Exceptions to the Clause? 

There are some exceptions to the incontestability clause. The most common exception is quite tragic: the suicide exclusion.

Many life insurance policies will stipulate that they will not provide coverage for suicide or attempted suicide during the contestability period.

However, this suicide exclusion must be clearly stated in the policy for the insurer to exclude you; they cannot choose to enforce it without an explicit suicide exclusion in the policy.

The burden is on the insurer to prove that the deceased intended to take their life, i.e., that the death was not accidental or due to their neglect.

Another common exclusion occurs when someone accidentally dies while committing a felony or a criminal act, such as speeding.

California set a precedent for this exclusion of accidental deaths during crimes in the 1970 court case Romero v. Volunteer State Life Ins. Co., concerning a felony drunk-driving incident. 

INSURANCE WHERE YOU LIVE

Life insurance by state.

How Incontestability Clauses Help You

Although the contestability period helps protect the insurance company from monetary loss due to false claims, the incontestability clause works in favor of the insured.

By limiting the contestability period to a certain amount of time, the likelihood that you will fall prey to an insurer trying to deny your claim is much lower. 

If your death or the death of your loved ones occurs outside the contestability period, you will still be able to receive a death claim payout.

The incontestability clause assures the financial stability of you and your family.

That’s why it’s important to consider purchasing life insurance earlier when your risk of death due to ailments or aging is lower. 

What to Do if Your Claim is Challenged

Should an insurer deny your claim, you should contact a licensed insurance lawyer right away.

This is because you will have a limited time to file a legal appeal following the rejection of a death claim. 

The time in which you can file an appeal is often 30 days but may be up to 60 days depending on your state.

what is a life insurance incontestability clause

The sooner you contact an attorney, the better your chances of receiving a successful appeal.

THE SIMPLY INSURANCE WAY

Life Insurance made easy.

Agents not required.

Get quotes and sign up online without talking to an agent. But, we are here if you need us. 

Unbiased, expert advice.

Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.

Coverage in minutes.

You can get life insurance coverage within minutes of getting your quotes and applying.

Taking Action

My goal was to offer you insight into incontestability clauses.

It should better prepare you to handle contestability and incontestability concerns, whether you already have an insurance policy or are looking to purchase one.

The best way to deal with contestability and incontestability clauses is to get the facts and I think this article should answer most of your questions.

If you need life insurance, you can get immediate quotes and coverage by clicking here or on any of the above buttons. 


Sa El

About the author

Sa El is the Co-Founder of Simply Insurance and a licensed Insurance Agent with over 11 years of experience in the industry.  He specializes in Life & Health Insurance and is certified in Long Term Care Insurance in the state of Georgia. He is also an Official Member of the Forbes Finance Council, a licensed real estate agent in the state of Georgia (License #382602), an entrepreneur, insurance educator, and freelance writer.


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