Which company policy can be voided due to misstatements on the application?

The correct answer highlights the principle of the incontestability clause, which is a standard provision in most life insurance policies. This clause typically states that after a specified period—commonly two years—the insurer cannot dispute or void the policy based on misstatements, inaccuracies, or omissions made in the application for insurance. The intent behind this clause is to provide policyholders with stability and assurance that their coverage will remain in force regardless of minor errors or misrepresentations made during the application process.

In the context of life insurance, if a policy has been in force for longer than the contestable period and the insurer attempts to void it due to misstatements, the policyholder is generally protected since the insurer has had ample time to assess the risk and underwrite the policy properly. This fosters trust in the insurance process and ensures that insured individuals are not unfairly penalized for unintentional errors.

Understanding the function of the incontestability clause is crucial in recognizing its implications for life insurance policies and why this type of policy cannot be voided simply based on misstatements after the defined period.