The incontestability clause prevents insurers from canceling or rescinding a life insurance policy after it’s been active for two full years, so long as the premiums were paid. Even if the application included omissions, misstatements, or forgotten details, the insurer typically loses the right to use them as grounds to deny a death claim.
But just because the law is clear doesn’t mean insurers follow it. If you need an Arkansas life insurance denial attorney call us.
The Loopholes Insurers Exploit—And Why You Should Be Worried
Insurers don’t like paying claims, especially large ones. That’s why, even after two years, they may try to claim:
The applicant lied about their age or gender (used to reduce benefits, not void the policy)
The policy was obtained through fraud or impersonation (difficult to prove and rarely pursued)
There was no insurable interest at the time of application (a mistake the insurer should’ve caught before issuing the policy)
In many states, even allegations of fraud must be proven in court—a denial letter alone is not enough. But most families don’t know this. Insurers count on silence and confusion to avoid scrutiny.
Case Example: The DNA Dispute That Backfired
In a New York case, an insurer tried to deny a $2 million death benefit by claiming the bloodwork on file didn’t match the deceased. They implied someone else had applied for the policy, calling it impersonation and fraud. The catch? The policy had been active for more than two years.
The court ruled against the insurer. Why? Because the contestability window had closed, and the beneficiaries were legitimate. The judge emphasized that if the insurer had doubts about identity, they had two years to investigate—not two decades. The incontestability clause blocked the denial.
That case set a critical precedent: even suspected fraud isn’t always enough if it’s raised too late.
Why This Clause Is a Lifeline for Families
Here’s what most people don’t know: many death claims are denied not because of real fraud, but because of harmless inconsistencies. A mistyped weight. An outdated medication list. A minor preexisting condition that never affected health. These are the kinds of details insurers love to weaponize during the first two years—but once that window closes, the incontestability clause kicks in and shuts the door on their excuses.
If the death occurs after the two-year mark, the burden shifts heavily to the insurer. And in most cases, they don’t want the fight. They may bluff, hoping you’ll walk away. But if you challenge the denial with legal firepower, they often back down.
Warning: Contestability Resets After a Reinstatement
Be careful: if the policy lapsed due to non-payment and was later reinstated, the contestability period resets. That means even if the original policy was five or ten years old, the clock starts over from the date of reinstatement. If the insured dies within two years of that reinstatement, the insurer gets a second chance to contest the claim.
We’ve seen insurers deliberately allow a policy to lapse, reinstate it without warning the family of the risk, and then use that new window to dig for denial grounds. It’s sneaky—but common.
Denied After Two Years? Here’s What to Do.
If your loved one’s life insurance claim was denied after the policy had been active for two years, you may be dealing with a wrongful denial. We routinely overturn these decisions—because once the incontestability clause applies, the insurer’s power to challenge the policy becomes extremely limited.
Our process:
Confirm policy age and premium history
Analyze the denial letter for improper claims of fraud or omission
Review all application materials and compare them to alleged discrepancies
Demand payout or initiate litigation, forcing the insurer to prove fraud in court
If you have a group policy under ERISA, time is even more critical. ERISA claims have strict deadlines and very short appeal windows. Miss them, and you could lose your right to challenge the denial forever.
You Don’t Have to Accept a Denial—Especially After Two Years
Insurers have lawyers. So should you. If your claim was denied based on old application details, we’ll make sure the incontestability clause is enforced. This clause exists to protect families from being blindsided—and we’re here to make sure it works the way it’s supposed to.