What type of clause prevents an insurer from denying a claim due to statements in an application after the policy has been in force for 2 years?

An incontestability clause is a provision commonly found in life insurance policies that restricts the insurer’s ability to deny a claim based on misstatements or omissions in the application after a specified period, typically two years. This clause provides a measure of security for policyholders, ensuring that after the policy has been in force for a designated period, the insurer cannot contest the validity of the policy based on those statements. The intent is to protect insured individuals from the fear of having their claims denied long after they have relied on the coverage, as long as they have not committed fraud.

This provision does not necessarily apply to inaccuracies or fraudulent actions; it is specifically designed to limit the insurer's ability to retract coverage based on the application details after the two-year period, thus promoting confidence and stability for policyholders.