A Massachusetts life policy is past the incontestable period. Under M.G.L. c. 175, § 132(2), which ground still permits the insurer to contest the policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
M.G.L. c. 175, § 132(2) makes the policy incontestable after two years except for nonpayment of premiums and the statute's other narrow exceptions. Nonpayment remains a live ground because the incontestability clause protects honest applications, not unpaid premiums — the insurer never has to cover a risk whose consideration stopped. An innocent misstatement becomes uncontestable at the two-year mark, a hazardous occupation found after issue is generally too late to raise, and a misstatement of age is never a contest at all: the benefit is simply adjusted to what the premium paid would have purchased at the correct age under M.G.L. c. 175, § 132(4).
Why the other options are wrong
- A) After the two-year period, even an intentional misstatement in the application can no longer be raised, subject to the statute's narrow exceptions.
- C) A hazardous occupation discovered after issue is not one of the enumerated exceptions in M.G.L. c. 175, § 132(2); it is barred once the policy is incontestable.
- D) Misstatement of age is handled by adjusting the benefit under M.G.L. c. 175, § 132(4), not by contesting the policy.
Memory hook
After two years, unpaid premiums still talk — misstatements no longer do.