Under M.G.L. c. 175, § 132(2), which category of benefits may a Massachusetts insurer carve out of the incontestability protection at its own election?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
M.G.L. c. 175, § 132(2) permits the insurer, at its election, to exclude total-and-permanent disability claims and additional accidental-death benefits from the two-year incontestability protection. These supplemental benefits are insurer options built on top of the base contract, and the statute lets the company keep them contestable where the policy so provides. The core promises of the policy — the base death benefit and the guaranteed value built up under it — do not fall within this elective carve-out, and the incontestability clause of M.G.L. c. 175, § 132(2) shields them after two years.
Why the other options are wrong
- A) The base death benefit is the heart of what the two-year incontestability clause protects; it is not an elective carve-out.
- B) The guaranteed cash value is a contractual core feature, not one of the § 132(2) elective exceptions.
- C) Dividends are a participation feature, unrelated to the disability and accidental-death carve-out the statute describes.
Memory hook
The optional riders — disability and accidental death — can stay contestable if the contract elects it.