Pennsylvania Life and Health Insurance Exam Practice Question
The provision that prevents an insurer from denying a claim after a policy has been in force for a certain period of time is called:
Correct Answer: A
Rationale: An incontestability clause ensures that after a specified period, typically two years, an insurer cannot deny a claim based on misstatements or omissions in the application, providing policyholders with security and peace of mind.
Option B, grace period, refers to the time allowed for premium payment before a policy lapses, not claim denial. Option C, waiver of premium, pertains to situations where premium payments are suspended, usually due to disability, rather than claim disputes. Option D, reinstatement clause, allows a lapsed policy to be reinstated under certain conditions, but does not prevent claim denial.
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