An accident and health policy has been in force for more than two years. The insurer discovers that the insured negligently understated her weight and failed to disclose prior back treatment on the application, but nothing was intentional. She now submits a claim for an unrelated condition. Under North Carolina's time limit on certain defenses:

Why D is correct

Under G.S. 58-51-15(a)(2)a, after 2 years from the date of issue (or reinstatement) no misstatement except a fraudulent one may be used to void the policy or deny a claim. The insured's negligent errors — an understated weight and an undisclosed prior treatment — are not shown to be intentional, so the defenses are time-barred and the claim must be judged as though the statements were correct. This is the accident and health counterpart to the life policy's contestability rule.

Why the other options are wrong

• A: Rescission for any misstatement at any time is exactly what the two-year time limit on defenses forbids; after two years only fraud survives (G.S. 58-51-15(a)(2)a).
• B: The statute does not create a partial remedy of denying the claim while keeping the policy — after two years the misstatement simply becomes unusable unless it was fraudulent (G.S. 58-51-15(a)(2)a).
• C: The two-year limit covers all misstatements, not merely age; the only defense that survives the window is fraud (G.S. 58-51-15(a)(2)a).

Memory hook

After 2 years only fraud bites — honest mistakes are spent.