First, a definition of the contestability clause in simple language.  Essentially, if the applicant of a life insurance policy misleads, misrepresents, or withholds material information to the life insurance company during the application process, the life insurance company may not have to pay benefits in the event of the insured passing away.   The key word there is material.  Material basically means that the information is important to the consideration of your application to the life insurance company.  A hangnail probably doesn't apply but elevated cholesterol does.  Our recommendation is to list everything and answer each question thoroughly and honestly so you can avoid any issues involved with the contestability clause when applying for life insurance.  Life insurance application tend to be less involved than average health insurance apps since both types of insurance plans differ in what they view as important.  Life insurance is more concerned with issues that affect mortality while health insurance is more concerned with issues that affect morbidity. 

There are two ways that the the contestability usually becomes an issue.  The first is that the applicant simply forgets information.  You want to make sure not to do this with larger issues.  Even if you honestly forgot a more serious issue, it can still come back to bite you via the contestability clause.   The life insurance application is a contract after all.  Even if honestly forgotten, material information left off the application can jeopardize the validity of the contract and potentially void the contract (and your ability of your life beneficiaries to receive life benefits). 

The other way is that a person is concerned about qualifying for life insurance and/or the rate and health class that will be offered based on pre-existing condition which leads them to conceal or misrepresent this information.  Don't do it.  It doesn't make sense to jeopardize your life insurance benefits by concealing information.  It defeats the purpose of buying life insurance altogether by doing this.  Life insurance is all or none...there's no 50% payout.  By jeopardizing your life insurance contract, your beneficiaries may end up with nothing.

There's a timetable that constrains the life insurance contestability clause.  The life insurance company has 2 years to use the contestability clause if evidence of misrepresentation, concealment, or material fraud occurs.  After this period of time, the carrier is unable to use this particular clause in such situations.  There are other options now if you have a health issue such as no medical life insurance.  We can also try to re-apply in the future to replace life insurance which is issued on a higher tier.  Some issues can be remedied with more time away from them such as driving record issues.  If you are concerned about your chances of qualifying, please contact us with your situation so can we avoid any issues with the contestability clause.