Which Statement About the Incontestable Clause Is True

question 50

Multiple Choice

Which statement about the incontestable clause is true?
I.It protects the beneficiary if the insurer tries to deny a claim years after the policy is issued.
II.If protects the insurer from having to pay a claim during the first two years if the insured made a material misrepresentation or concealed material information in the application.

• A)I only
• B)II only
• C)both I and II
• D)neither I nor II

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Definitions:

Allowance For Uncollectibles

A balance sheet account estimating the portion of receivables that a company does not expect to collect.

Net Realizable Value

Net Realizable Value is the estimated selling price of goods, minus the cost of their sale or disposal, representing the actual value of assets in terms of cash.

Estimated Future Returns

Projections or forecasts of the financial returns a company expects to receive from investments, assets, or business activities in the future.

End-Of-Period Accrual

Accounting adjustments made at the end of accounting periods to record revenues earned and expenses incurred but not yet recorded.