For how long are new life insurance policies contestable for material misrepresentation?

New life insurance policies are contestable for material misrepresentation for a period of two years from the date of policy issuance. This is a standard provision in most life insurance contracts, aimed at protecting the insurer from fraud or intentional misrepresentation during the application process.

During this two-year period, if an insurer discovers that the applicant provided false information or omitted important details that could influence the underwriting decision, they have the right to contest the claim and potentially deny benefits. After the two-year contestability period expires, the policy generally becomes incontestable, meaning the insurer cannot deny a claim on the basis of misrepresentation, except in cases of fraud or non-payment of premiums. This provides policyholders with a level of assurance that their coverage will remain intact as long as premiums are paid and no fraudulent activity is involved.

This two-year timeframe balances the interests of both insurers and insureds, ensuring that insurers can verify the integrity of applicants' representations while also providing a reasonable timeframe where the insured can expect the policy to remain in force without contestation based on earlier disclosures.