What happens under the misstatement of age provision when an insurer discovers an insured has misstated their age?

When an insurer finds that an insured has misstated their age, the misstatement of age provision typically allows for adjustments to premiums and benefits rather than termination of the policy. This provision is designed to address situations where the insured's age is crucial in determining the premium rates and the amount of coverage provided.

If the insured has provided an incorrect age, the insurance company will adjust the policy benefits and premiums based on the correct age at the time the policy was issued. For example, if the insured is younger than stated, the insurer may recalculate the premiums based on this new information but may also consider the benefits payable—potentially reducing them since younger individuals typically pay lower premiums for life insurance. Conversely, if the insured is older than stated, the insurer may charge higher premiums or reduce the benefit accordingly.

This approach helps maintain fairness in the insurance agreement, ensuring that coverage remains in line with the actual risk associated with the insured's true age without resorting to drastic measures like termination of the policy.