During the underwriting process for a new life insurance policy, an applicant, Mr. Jenkins, intentionally failed to disclose a recent diagnosis of diabetes, believing it would increase his premiums significantly. He answered 'No' to a direct question about chronic illnesses. This omission is discovered two years after the policy was issued and a month after Mr. Jenkins passed away. Which of the following statements about the insurer's actions is most likely true?

Question: During the underwriting process for a new life insurance policy, an applicant, Mr. Jenkins, intentionally failed to disclose a recent diagnosis of diabetes, believing it would increase his premiums significantly. He answered 'No' to a direct question about chronic illnesses. This omission is discovered two years after the policy was issued and a month after Mr. Jenkins passed away. Which of the following statements about the insurer's actions is most likely true?

Answer options: ✅ The insurer will void the policy and deny the claim due to the material misrepresentation.

• The insurer will pay the claim in full because two years have passed since policy issuance.
• The insurer will recalculate the premium based on the actual health status and deduct the difference from the death benefit.
• The insurer will pay a reduced death benefit equal to the premiums paid by Mr. Jenkins.

Correct answer: The insurer will void the policy and deny the claim due to the material misrepresentation.

Explanation: Even though two years have passed, intentional material misrepresentation, such as knowingly misstating a chronic illness, can lead to the voiding of a policy and denial of a claim. The contestability period generally applies to unintentional or innocent misrepresentations.