What Will Void A Life Insurance Policy?

  1. 4330 POINTS
    Jerry Vanderzanden, CLU, ChFC
    Co-Founder, Coastal Financial Partners Group, California
    Generally, a policy may be considered void in the event of fraud. There have been many well publicized instances in recent years of insurance fraud concerning stranger owned life insurance transactions. Life insurance companies have been able to rescind coverage and the cases end up in the courts eventually. These situations are rare but they have been known to occur.
    Answered on May 21, 2013
    flag this answer
  2. 12689 POINTS
    Ted Ratliff
    Owner, SFS Associates,
    If a person lies on an application the policy will be rescinded and premiums paid refunded.  For example, if you have sound reason to believe that you have cancer.  Even though it hasn't yet been diagnosed, if the company finds out or you die within two years the policy will not pay.
    Answered on May 21, 2013
    flag this answer
  3. 11783 POINTS
    Contact Me
    Larry GilmorePRO
    Agent Owner, Gilmore Insurance Services, Marysville, Washington State
    what will void a life insurance policy?  Basically any deciet given during the application process will void a policy if found out within the first two policy years. After that, in most cases contestability by an insurance carrier has ended. Except some states have modified contestibility laws sometimes in the insurance company's favor. In my state, concerning lying about smoking on the application, there is no limit for an insurance company to contest. The state considers the policy null and void. Other states may have something similar.
    Answered on May 22, 2013
    +0
    1 Thumb up 0
    +1 this answer
    flag this answer
  4. 0 POINTS
    Contact Me
    David RacichPRO
    Fountain Hills, Arizona
    There are a couple of reasons why a life insurance policy would be declared void by the issuing company. During the first two years of contestability, suicide of the insured and fraud discovery can void the policy. And with some states and life insurance companies fraud may extend for a longer period.
     
    Answered on May 22, 2013
    +1
    1 Thumb up 0
    +1 this answer
    flag this answer
  5. 37376 POINTS
    David G. Pipes, CLU®, RICP®
    Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
    When a person applies for life insurance they make “representations.”  The company issues the policy on these statements.  If the person makes false “representations” the company has some recourse to refuse coverage normally for a limited time.  If the person commits suicide in the first two years, most companies will refuse coverage.  When a life insurance company refuses coverage they return the premiums paid.  
    Answered on May 27, 2014
    flag this answer
    6. Did you find these answers helpful?
    Yes
    No
    Go!

Add Your Answer To This Question

You must be logged in to add your answer.


<< Previous Question
Questions Home
Next Question >>