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Is the life insurance company withholding benefits from you? The incontestability clause is one of the strongest protections for a policyholder or beneficiary. While many other rules for insurance seem to favor the companies, this rule soundly sides of the consumer.

Life insurance is a contract between two parties: the insurance company and the policyholder. A conventional rule for contracts says that if one party has given false or incomplete information that the other party relied on when making the contract, the second party has the right to void or cancel the agreement. That party can claim that there was no valid contract in the first place. The incontestability clause forbids insurance companies from doing exactly that.

About a century ago, state governments began to require life insurance companies to add these clauses to every policy they issue. Today, almost all life insurance policies will contain this provision in some form. Typically, the clause states that, after two years (or even only one year in some states) the company cannot void the policy if the policyholder is paying the premiums.


State laws often permit three exceptions to the incontestability clause.

Most states provide that if the insured person misstated age or gender when applying for life insurance, the insurance company may not void the policy. Instead, it may adjust the death benefits to reflect the policyholder’s true age.

Some states allow life insurance companies to include a provision stating that the contestability period must be within the lifetime of the insured. This allows an insurance company to refuse benefits if a policyholder was unwell when applying for coverage and died within that period.

Some states also allow the insurance company to void the policy if it can prove deliberate life insurance fraud.

How the Incontestability Clause Helps Consumers

It is easy to make a minor error when applying for life insurance. Applicants must often provide a complete medical history before the company approves their policy. Forgetting to list a hospital stay, illness, occupational hazard, or even an allergy on the application may give the insurance company grounds to deny paying benefits later.

In fact, it was often the standard practice for life insurance companies in the late 1800s. Many insurance firms used deceptive practices to collect premiums and deny benefits on a technicality. In fact, reputable insurance companies originally introduced the incontestability clause to build consumer trust. By promising to pay full benefits after the policy has been in place for two years (even if there were errors in the application), insurance companies tried to clean up the industry’s image. This proved so successful that, early in the 20th century, state governments began to pass laws requiring insurance companies to include the incontestability clause.

Today, when someone purchases life insurance, the clock begins to run on the contestability period. If, after two years, the insurance company has not found an error in the application, they ensure benefits. Even within that period, it’s not easy for the company to rescind a life insurance policy. Under most state laws, the company will have to file suit in court to null the contract. Sending a notice to the policyholder is not enough.

What to Do if Your Policy is Challenged

Legal action to rescind your policy allows you to challenge that claim. Similarly, if you are a beneficiary for life insurance but the company is withholding benefits, the incontestability clause may force the company to settle.

The specific facts in your case will help determine the outcome. That’s why you need legal advice. Our life insurance lawyers work with clients across the U.S. to recover delayed and denied life insurance claims.

We can negotiate with the life insurance company to obtain a settlement. Or, we can take your case to the courtroom. Call us today at (215) 531-7961 for a free and confidential consultation. You owe us nothing unless we get you a recovery.

If you have questions, our firm can provide all the information in your free consultation. Call us toll-free today to seek the full life insurance benefits you deserve.

(215) 531-7961

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About Life Insurance Lawyers

Life Insurance Law, LLC is a nationwide network of attorneys who work with clients to recover denied or delayed life insurance claims.

We created this network to people get the benefits they deserve, even after their life insurance claims were denied or delayed.