If a policyholder dies within the first two years of purchasing a life insurance policy, the insurer has the right to investigate the application for misrepresentations. This is known as the contestability period—and it often leads to claim delays or denials. Even small omissions or unintentional misunderstandings on the application can become grounds for nonpayment. However, insurers often abuse this process to avoid paying out valid claims. If you've received a denial based on alleged misstatements, legal action may be the only way to recover the benefits.
Understanding the contestability clause
Most life insurance policies include a two-year contestability period from the date of issue. This provision allows insurance companies to review the policyholder's original application if death occurs within those two years. The purpose is to catch material misrepresentations—i.e., false information that could have affected the insurer's decision to issue coverage or set premium rates.
But there's a major catch: the cause of death doesn’t have to be related to the misrepresentation for the insurer to deny the claim. That means someone who incorrectly reported their smoking status, for example, could be denied after dying in a car accident. This creates a dangerous opening for insurers to comb through every detail of the application and deny claims for the smallest inconsistency.
A case of scuba diving—and a wrongful denial
Justin was a thriving tech executive in his late 50s when he accepted a CEO role at a startup company. The new position came with a generous compensation package, including a $2.5 million life insurance policy. To activate the policy, Justin completed a comprehensive health and lifestyle questionnaire.
One question asked: “Do you regularly engage in any of the following activities? Scuba diving, skydiving, bungee jumping, mountain climbing, motorcycle racing, or cliff diving?”
Justin answered “no.” At the time, this was completely true—he had never tried any of those activities.
Six months later, however, Justin and his wife Cynthia took a vacation to the Grand Caymans. On a whim, they signed up for scuba diving lessons and were instantly hooked. Over the next year, they went diving two more times during international trips.
Eighteen months after securing his life insurance policy, Justin tragically died in a car accident.
The insurer’s investigation—and denial
Grieving but determined, Cynthia filed a claim on Justin’s life insurance policy. She submitted all required documents and expected the process to proceed smoothly. Instead, she received a notice of delay. The insurer explained that since Justin died within the contestability period, they would be investigating the validity of his original application.
Weeks later, Cynthia was stunned to receive a formal denial. The insurance company claimed that Justin had misrepresented himself in the application by denying participation in “scuba diving,” a hazardous activity. They cited multiple photos of Justin diving, which were posted on social media after his death. According to the insurer, this inconsistency justified denying the $2.5 million death benefit.
The legal response: defining ‘regularly’
Unwilling to accept this decision, Cynthia contacted a law firm that specializes in life insurance claim denials. The attorney she hired immediately identified the flaw in the insurer’s argument.
The policy application didn’t ask whether the insured had ever tried scuba diving. It asked whether the insured regularly engaged in it. By the time Justin died, he had been scuba diving just three times—none of which occurred before the application. This did not meet any reasonable definition of “regular” participation.
The attorney filed an appeal with the insurer’s internal review board. He supplemented the appeal with sworn affidavits from friends and doctors confirming that Justin had never scuba dived prior to his 59th birthday. A medical expert also submitted an opinion confirming that the cause of death—a motor vehicle accident—had no connection to scuba diving or any activity that could be deemed hazardous.
The attorney also made a persuasive argument during the appeal hearing: “If occasional participation in an activity after the application is considered a misrepresentation, then every policyholder would be at risk of losing coverage for trying something new.”
The review board ultimately agreed. The insurer reversed its denial and paid Cynthia the full $2.5 million benefit, plus interest.
What this case teaches us about insurance company tactics
Cynthia’s story is not unique. We regularly see life insurance companies misuse the contestability period to deny claims they should be paying. They often comb through social media, doctor’s records, or vague application answers to find technicalities—regardless of whether those details had any bearing on the insured’s death.
In many cases, these denials are based on misinterpretations or manipulations of the policy’s language. The key takeaway? Even if the insurer claims a misrepresentation occurred, you may still have a case.
How to protect yourself and your loved ones
If you’re applying for life insurance:
Be honest and thorough in your application
Ask your agent to clarify ambiguous questions
Document your responses and keep a copy of the application
If you're filing a claim as a beneficiary:
Request a complete explanation for any delay or denial
Do not assume the insurance company’s interpretation is correct
Contact a life insurance attorney for a second opinion
Don’t let a vague or misleading denial go unchallenged
Whether the insurer is invoking the contestability clause or a policy exclusion, many denials can be reversed with the right legal support. Our firm has years of experience handling these types of claims. If we take your case, we will fight to get you the benefit your loved one intended—and you won’t owe us anything unless we win. If you have a life insurance claim help in North Dakota call now.
FAQ: Contestability Period and Misrepresentation in Life Insurance
What is the contestability period in life insurance?
It’s the first two years after a life insurance policy is issued. If the insured dies during this time, the insurer can review the application and deny the claim for any misstatements—even unrelated ones.
Can a claim be denied for something unrelated to the cause of death?
Yes. If the insured misrepresented their health or lifestyle on the application, the insurer can deny the claim even if the death was caused by something completely unrelated.
What counts as a misrepresentation?
Anything untrue that could have influenced the insurer’s decision to issue the policy or set premiums. This includes omitting medical conditions, smoking habits, or dangerous hobbies.
What if the insured’s answers were technically correct?
Insurers sometimes misinterpret vague questions. For example, answering “no” to scuba diving might be reasonable if the insured had never tried it before. Legal help can clarify those disputes.
Is it worth appealing a claim denial during the contestability period?
Absolutely. Many denials are based on weak or misinterpreted evidence. A skilled life insurance lawyer can challenge the decision and recover the payout.