Incontestable Policy Law and Legal Definition
Incontestable policy is a policy containing provisions such as an incontestable clause prohibiting the insurer from canceling the policy or contesting upon the policy on the grounds of fraud, misrepresentation or concealment by the insured in obtaining the policy. The Incontestable Clause in a policy states that after the life insurance policy is in force for two years, the insurance company cannot void it because of misrepresentation or concealment by the insured in obtaining the policy.
Usually, an insured dies only after several years of opening of a life insurance policy. If the insurer contests on the basis of the statements made in the application then the beneficiary will be at loss. It is to prevent such disaster that an incontestable clause is added in an incontestable policy.
