Explain what happens with regard to the insured misstating his/her age. Does the incontestable clause modify this result? Explain
What will be an ideal response?
When the insured misstates his or her age, the policy proceeds are adjusted to an amount given the insured's true age and the actual amount of premium paid. The incontestable clause does not prevent the misstatement of age clause from being implemented, because the incontestable clause bars the contesting of entire contracts and not of individual policy provisions. So even if death occurs after two years, the policy face amount is merely adjusted.
You might also like to view...
Which of the following conditions would make a lockbox system potentially more attractive to a firm?
A) mail time saved is lower B) payment size is higher C) the interest rate declines D) processing time saved is lower
On December 1, 2017, Going Places, Inc sold machinery to a customer for $22,000
The customer could not pay at the time of sale but agreed to pay 10 months later and signed an 10-month note at 9% interest. What was the total amount of cash collected by Going Places on the maturity of the note? (Round your answer to the nearest dollar.) A) $23,980 B) $23,650 C) $20,350 D) $1,650