New York Insurance Exam Practice Question
What is the purpose of a policy's incontestability period?
Correct Answer: B
Rationale: The incontestability period serves to limit the insurer's ability to contest claims after a specified time, typically two years. This provides policyholders with security, ensuring that once the period expires, the insurer cannot deny claims based on misstatements or omissions in the application.
Option A is incorrect as the incontestability period does not pertain to premium refunds. Option C is misleading; the period does not increase the death benefit but rather secures the existing benefit. Option D is also wrong, as it does not involve waiving premiums but focuses on the insurer's contestability of claims.
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