Dennis Applied for a Policy of Life Insurance and One

question 39

Essay

Dennis applied for a policy of life insurance and one of the questions on the medical questionnaire asked: "Have you ever been hospitalized?" Dennis answered truthfully that he had been hospitalized in 1993 to have his tonsils out and in 1996 to have his appendix out. The life insurance policy was issued. Sixteen months later Dennis died of a heart attack and the insurance company discovered that he had been hospitalized in 1985 due to a mild heart attack. The beneficiary of the life insurance policy applied for the death benefit claiming quite correctly that Dennis had been truthful in the application, but the insurance company refused to pay the death benefit. What legal basis does the insurance company have for refusing to pay?

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Definitions:

Remembered

Pertains to information or experiences that have been stored in memory and can be retrieved.

Prefrontal Cortex

The part of the brain located at the front of the frontal lobes, involved in complex behaviors such as decision making, planning, and moderating social behavior.

Overconfidence

An overly positive judgment of one’s own decision-making abilities and performance.

Participant Confidence

The level of belief individuals have in their own abilities and judgments during participation in an activity or research.