"Spending a whole day looking for insurance is fun," said nobody, EVER!
  • Things to know about the contestability period in life insurance

     4.5 / 5.0   by 16742 users
    Used this product? Write a review >>

    Fees & Charges

    Promised Interest Rate

    Plan Benefits

    Payment Options

    Policy Coverage

    Customer Service

    Responsiveness

    The contestability period is a vital clause in a life insurance policy which every policyholder should know in detail. It starts from the date of issuance of policy and lasts for a duration of two years. Even though the buyers often tend to ignore the contestability period while signing the policy papers, it significantly impacts the beneficiary claims that are made before the completion of this period. Read through the page to know about some of the vital aspects of this clause.

    What is the contestability period in life insurance?

    The contestability period is a clause in a life insurance policy according to which if the policyholder expires within two years of purchasing the policy, the insurance company can contest or question the claim raised by his/her beneficiaries. In such cases, the insurer will have the right to ask for verification of the personal details of the buyer. This clause enables the insurers to deny or cancel a claim made before the completion of two years from the policy date. In certain cases, they even have the right to withhold parts or the entire benefit payment from the beneficiaries. Some companies also have a clause according to which if the policyholder commits suicide within two years from the policy issuance date the beneficiaries cannot claim the death benefit. They will straightforwardly deny if any claims are made in similar instances.

    How the customers usually breach the contract?

    There are various ways how customers usually breach the contract. Lying about one’s medical condition, past health status, dangerous job profile, unhealthy habits, drug abuse, and other addictions are considered as discrepancies. Here is an example to help you understand it better.

    Example -

    Suppose you are a chain smoker or addicted towards alcohol but while buying your life insurance policy you falsely represented that you don’t smoke or drink. Now, unfortunately, if you die within 2 years of purchasing the policy, the company will have the right to investigate your past in order to verify the authenticity of the information provided by you at the time of policy purchase. In case you are found to be guilty of providing wrong information the company will have the authority to deny the insurance amount claimed by your family members/beneficiaries.

    What is the significance of the contestability period?

    The insurance companies often come across cases where the buyers provide inaccurate or false personal information about their lifestyle, health, and job nature with an intent to mislead the insurers. Since the cost of premiums of a life insurance is based on the age and the medical history of the insured, there is a high possibility that the customers in order to reduce the cost of the premium, may tend to give false or inaccurate information regarding their health and lifestyle. Hiding hazardous occupation, unhealthy habits, drug abuse or addictions, risky hobbies, etc. are some of the areas where a customer can possibly lie to mislead the insurers and thereby, reducing the premium rate. This is where the clause of contestability comes into play.

    The main purpose of including this clause in the life insurance policy documents is to protect the companies against fraud claims. It allows the insurer to evaluate and investigate the medical history of the customer and find out the credibility of the information provided at the time of insurance policy purchase. In this way, it not only safeguards the insurers against discrepancies but also gives them a fair chance to question the authenticity of a policy claim.

    How is a claim contested by the insurance companies?

    While contesting a claim the insurance company at first investigates the authenticity of the claim by checking the medical history and other personal documents of the customer. In the process, if the company gets hold of any evidence that proves misrepresentation or breaching of contract by the insured, it can deny or cancel the claim. There is no fixed time of investigation and it can vary according to the circumstances. While some investigations may take a few days others can linger up to weeks or months.

    What can happen if the company contests a claim?

    Misleading the insurer by providing inaccurate information is a matter of breaching and in such cases the company holds the right to check the authenticity of the insurance claim. Such contested claims are usually settled by the insurance companies in the following ways:

    • In case of authentic claims

    If the information provided by the policyholder in the application form is found to be true, the insurance company approves the claim while also giving interest along with the total payout to compensate the delay caused due to the contestation process.

    • In case of information breach

      • The insurer usually pays the death benefit to the beneficiaries after deducting the additional premiums that would have been charged if the actual information was provided at the time of purchase. For instance, in case of a smoker or an alcoholic, the extra amount that he/she would have actually paid as premiums will be deducted from the total amount of death benefit.
      • Alternately, in certain cases the company can completely deny the claim and give the premiums back to the beneficiaries. However, the insurance companies take such strict actions only in cases where the new information gathered about the policy holder’s medical history, health, job nature, etc. are beyond the coverage of the policy.

    What are the changes that take place after the contestability period?

    Here are the changes that ideally take place in a life insurance policy after the contestability period is over:

    • After the completion of the contestability period, a life insurance policy becomes incontestable. This means the beneficiary will receive the entire coverage amount as long as the policy is in effect. However, in some policies, there might be certain exclusions where the beneficiaries don’t get paid.
    • If the coverage of your life insurance policy lapses, the new contestability period will start only when you reinstate or purchase a new life insurance policy. While buying the new policy make sure to provide only correct information to avoid future hassles.

    Vital points to know about the life insurance contestability period

    Some very important points that you should know about the contestability period of your life insurance policy are as follows:

    • Being untruthful on your life insurance application form for getting premiums at lower rates can be dangerous for your loved ones after your death. If you lie on the life insurance application form thinking that you will be able to live through the contestability period, it can lead to denial or cancellation of the policy claim after your death. Since you are taking the policy to secure the future of your family members when you will be no more to take care of their financial needs, make sure that no information provided on the application form is false or inaccurate.
    • Even though the insurance companies have the right to investigate and verify any claim made during the contestability period, they still will have to pay the death benefits to the policyholders’ family if the accuracy of the information is proved.
    • If you die during the contestability period, your family might have to wait to get the money for quite a long time until the company investigates the matter and is satisfied with the outcome.

    Now that you know everything about the life insurance contestability clause, make sure to furnish only the correct information about your health and medical status while you are buying a life insurance policy. Remember, honesty is the key to get through the life insurance contestability period clause. If you are honest at the time of purchasing the policy your family will get the money even if you die after one hour of buying the insurance cover.

    Contestability Period in Life Insurance Reviews

  • Page 1 of 50 1 2 3 4 5
    • ICICI Prudential Life Insurance
      "Worst Policy Provider. Dont Trust them"
      0.5 0.5/5 "Unacceptable"
      one of the unethical and non trusted brand. don't go with icici policy there are lots of hidden clause which these guys hide from you. please avoid going for icici pru policy. I have avail policy in month of January they have hide lots of bad things about policy.
      Was this review helpful? 0
      , pune
      Reviewed on Sep 17, 2018
    • Future Generali Life Life Insurance
      "Average Service"
      0.5 3.0/5 "Satisfactory"
      I've a life insurance policy with the Future Genrali. I am paying a premium of 12000 per year. Their hasn't been any issues with the policy. The policy is a normal life insurance with out any commendable benefits. They need to improve their customer support services.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 15, 2018
    • Kotak Life Life Insurance
      "Average Service"
      0.5 3.0/5 "Satisfactory"
      I've a life insurance policy with the Kotak, I am paying a premium of 11000 , they need to work on their promises while purchasing the policy. I am just paying the premium with out any benefits or a proper support. When it comes to serving customers they're all hesitant.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 15, 2018
    • Max Life Insurance
      "Average Service"
      0.5 3.0/5 "Satisfactory"
      I've a life insurance policy with the Max Life. I am paying a premium of 35K per year, they all provide massive offerings in order to convince the customers but once the customer has taken the policy; the service part becomes pathetic. They need to be more helpful and beneficial form the customer point of view.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 15, 2018
    • Birla Sun Life Insurance
      "Good Policy"
      0.5 4.0/5 "Great!"
      I have a life insurance policy with Birla Sun Life from last 10-12 years and it is a long term policy. I pay a premium of Rs 6000 once in 6 months and i am convenient with the payment options. The tenure period for this insurance policy is 20 years.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 14, 2018
    • LIC Life Insurance
      "Best policy"
      0.5 5.0/5 "Blown Away!"
      My life is insured with LIC from last 12 years and it is s long term policy. The name of the policy is Jeevan anand and the tenure period for this policy. I pay my premium once in 3 months through net banking and the maturity period for this policy is 16 years.
      Was this review helpful? 0
      , pune
      Reviewed on Sep 12, 2018
    • Aviva Life Insurance
      "Best policy"
      0.5 5.0/5 "Blown Away!"
      I have a life insurance policy with AVIVA life from last 6 years, i am happy with the coverage value of this policy. It covers critical illness as well as it has a cashless treatment. A premium of Rs 4500 has to be paid for this policy and i pay it through net banking.
      Was this review helpful? 0
      , pune
      Reviewed on Sep 12, 2018
    • LIC Life Insurance
      "Good Policy"
      0.5 3.5/5 "Pretty good"
      I hold a Money back policy with LIC from last 6-8 years, i get a money back after every 4 years. I pay my premium once in a year by cheque and i am convenient with the payment options. I am happy with the returns and benefits of this policy. The tenure period for this loan is 25 years.
      Was this review helpful? 0
      , chennai
      Reviewed on Sep 12, 2018
    • LIC Life Insurance
      "Good Policy"
      0.5 4.0/5 "Great!"
      I have a life insurance policy with LIC from last 1 year and it is a long term policy. I am happy with the returns and benefits of this policy. I pay my premium once in 3 months through net banking and i am convenient with the payment options. The maturity period for this policy is 15 years
      Was this review helpful? 0
      , chennai
      Reviewed on Sep 12, 2018
    • LIC Life Insurance
      "Good Policy"
      0.5 3.5/5 "Pretty good"
      I have a life insurance policy with LIC from last 4 years and it is a long term policy. I am satisfied with the coverage and returns of this insurance policy. I pay my premium on yearly basis and the payment mode is Auto debit. The tenure period for this policy is 15 years.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 12, 2018
    • LIC Life Insurance
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I've two life insurance policies with the LIC, I'm paying a premium of 40000 for the two policies. I am making the premium payments online. So far there hasn't been any issues with their services.
      Was this review helpful? 1
      , lucknow
      Reviewed on Sep 11, 2018
    • LIC Life Insurance
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I've two life insurance policies with the LIC, I'm paying a premium of 40000 for the two policies. I am making the premium payments online. So far there hasn't been any issues with their services.
      Was this review helpful? 0
      , lucknow
      Reviewed on Sep 11, 2018
    • SBI Life Life Insurance
      "Average Service"
      0.5 3.0/5 "Satisfactory"
      I've a life insurance policy with the SBI Life. I am applying a low premium, So far it has been a hassle free experience with the policy. I am just paying the premium. The premium is comparatively low.
      Was this review helpful? 1
      , udaipur
      Reviewed on Sep 11, 2018
    • ICICI Prudential Life Insurance
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I've a life insurance policy with the ICICI Prudential Insurance for a while. Their services are good. I am paying the premium regularly. So far there hasn't been any issues with their services so far.
      Was this review helpful? 1
      , bangalore
      Reviewed on Sep 11, 2018
    • Max Life Insurance
      "Good services overall"
      0.5 4.5/5 "Excellent!"
      Max Life Insurance was pretty quick in the response for the term plan. The plan riders come up with good set of critical illness. The insurance procedure was quiet well described and executed. Just wish to add one point for the medical test center guys, please try to maintain cleanliness of the instruments because it will help in creating a hygienic impression of the process.
      Was this review helpful? 2
      , ahmedabad
      Reviewed on Sep 10, 2018
    • LIC Life Insurance
      "Good Service"
      0.5 4.0/5 "Great!"
      I've a life insurance policy with the LIC. I am paying a premium of 3100 quarterly, I am making payments online. The offers flexibility of loans and their services are friendly.
      Was this review helpful? 2
      , bangalore
      Reviewed on Sep 07, 2018
    • LIC Life Insurance
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I've a life insurance policies, I am paying a premium 50000 per year, I have 2 policies. I am paying the premium via the LIC portal. So far it has been a good experience with the policies and their services.
      Was this review helpful? 2
      , hyderabad
      Reviewed on Sep 07, 2018
    • SBI Life Life Insurance
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I've a life insurance policy with the SBI life. I am paying a premium of 40000 per year, sum assured is good and the policy features were good. So far it has been a very good experience with the policy and their services.
      Was this review helpful? 2
      , hyderabad
      Reviewed on Sep 07, 2018
    • LIC Life Insurance
      "Very Good Service"
      0.5 4.0/5 "Great!"
      I had taken this insurance policy almost three years back and i had taken this insurance policy with the help of an agent. The process of payments has been nice and i had been making the payments directly with cash, it has been easy. Their customer support and their staff responses also had been good as well.
      Was this review helpful? 2
      , coimbatore
      Reviewed on Sep 07, 2018
    • LIC Life Insurance
      "Very Good Service"
      0.5 3.0/5 "Satisfactory"
      I had taken this Life Insurance policy almost 20 years back and it had been a good experience i had with them. I had been making the payments every month and th payments had been easy since it will be directly deducted from my salary. Their customer support and their staff responses had not been bad and they could improve in their responses.
      Was this review helpful? 1
      , hyderabad
      Reviewed on Sep 07, 2018
    Common Loader Icon
    Page 1 of 50 1 2 3 4 5

    Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.

  • reTH65gcmBgCJ7k
    This Page is BLOCKED as it is using Iframes.