- 7,790
I will assume you are in Maryland. I suggest you change your state flag from Alabama to Maryland. I sent you a PM with my serious thoughts on the question.
Incontestability Clause
- Thread starter u18247
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I will assume you are in Maryland. I suggest you change your state flag from Alabama to Maryland. I sent you a PM with my serious thoughts on the question.
- 4,130
So state by state it may be different. Vol asked for a copy and I can't tear up a new policy but I did write it down.
Originally Posted by VolAgent
With respect to statements made in the original application, this policy is not contestable except for fraud as permitted in the jurisdiction where the policy is delivered, after it has be in effect druing the insured's lifetime for a period of two years beginning with the eariler of the date insurance begins and the date of issue.
says exactly the same wording about "supplemental apps" and "reinstatement"
where "original application" is.
And this is one I should have mentioned yesterday...a little farther down caught it while typing the stuff above...
Our right to contest this policy includes the right to contest this policy for misrepresentation about the insured 's smoking status and the insured's use of any product containing nicotine
So it sounds like Washington is different than Maryland in how the OIC veiws fraud.
The important thing is be right for the state you are writing business in.
Again nothing an agent should be encouraging any applicant to do, because either the family or the insurance company is going to go after the agent in a case like that. The agent loses if they know about it or suggest it.
Originally Posted by VolAgent
You wouldn't happen to have a specimen policy would you? I'd like to see how their wavier is written.
Sorry no, I just have a recent delivered policy. It is section 6.10.With respect to statements made in the original application, this policy is not contestable except for fraud as permitted in the jurisdiction where the policy is delivered, after it has be in effect druing the insured's lifetime for a period of two years beginning with the eariler of the date insurance begins and the date of issue.
says exactly the same wording about "supplemental apps" and "reinstatement"
where "original application" is.
And this is one I should have mentioned yesterday...a little farther down caught it while typing the stuff above...
Our right to contest this policy includes the right to contest this policy for misrepresentation about the insured 's smoking status and the insured's use of any product containing nicotine
So it sounds like Washington is different than Maryland in how the OIC veiws fraud.
The important thing is be right for the state you are writing business in.
Again nothing an agent should be encouraging any applicant to do, because either the family or the insurance company is going to go after the agent in a case like that. The agent loses if they know about it or suggest it.
- 15,041
Yeah, except I wanted to see the wavier of premium provision. I believe you about the incontestability part. I'm just curious how Genworth's wavier is written on their ColonyTerm products. Doubt I'll be able to get a specimen until Monday now.
But you are exactly right, an agent should not condone, encourage, permit, or even have reason to believe an applicant lied on an app. Rick over at TGP says he'll even rat out the applicant on a cover letter to the underwriter if he doesn't believe the applicant.
- 15,041
Well, just heard from the TN DOI. Basically they said they would defer to the policy language. I was told by the investigator that it is rare and that they probably would get involved to review the rescession, but the insurer can rescind for clear fraud if the policy allows it.
- 4,130
"Basically they said they would defer to the policy language"
Yea, think of it as an employee handbook a business has. When legal issues arise between employer and employee, the government often looks to the employee handbook for what was established there.
Good information.
Yea, think of it as an employee handbook a business has. When legal issues arise between employer and employee, the government often looks to the employee handbook for what was established there.
Good information.
- 15,041
The funny thing was, he was a senior investigator and he didn't want me to pin him down to anything. I was on a cell, so there was some background noise and he was a bit hard to hear at times, but he bobbed and weaved with the best of them. It was always, "Well, if it is an approved policy, we'll look at the language.." And "Well, we'd probably review any denial..."
- Thread starter
- #37
It sound like the answer to the question depends on the state and the wording of the policy. I looked up some law in my state. They do not allow the "except fraud" provision in a life policy, but do in a disability policy. In the DI policy the company must use the "except fraud" wording or they can't contest it after 2 years. The life policy simple. 2 years they can't hold any fraudulent statements against the insured.
I read one case where the insured clearly lied and the judge agreed he lied and he died just before the period expired. The beneficiary sued on the basis the contestability period started on the date of the conditional receipt and won the case.
The bottom line here is like the investigator said, these things come up very rarely in life cases. If you are by the contestability period period and you die, the beneficiary is paid. All the cases of life insurance that I could find that were contested after the 2 years were very egregious ( imposter fraud, life settlement cases with insurabilty questions and murder).
I read one case where the insured clearly lied and the judge agreed he lied and he died just before the period expired. The beneficiary sued on the basis the contestability period started on the date of the conditional receipt and won the case.
The bottom line here is like the investigator said, these things come up very rarely in life cases. If you are by the contestability period period and you die, the beneficiary is paid. All the cases of life insurance that I could find that were contested after the 2 years were very egregious ( imposter fraud, life settlement cases with insurabilty questions and murder).
- 15,041
Don't be so sure of that. It isn't in the law here, but it is how it is practiced.
- Thread starter
- #39
I am just telling you how it works in my state. Don't know anything about other states. I will say I don't care what state you are in, if someone has a policy for say 10 years and a company tries to deny a death benefit because they lied about smoking, dr visits, medication or whatever; I would just tell the company good luck. They are not going to win in court and they will get creamed by the media. They may even end up paying out more than the face amount for bad faith.
- 15,041
What state is this? And does the approved policy have the language, "except for fraud." in its incontestability policy? Two people have already shown two different states that don't mention fraud in the law, but practice allowing contesting a fraudulently obtained policy.
