What is the maximum duration of the Contestable Period in a health insurance policy?

The correct choice for the maximum duration of the Contestable Period in a health insurance policy is two years. This duration is established by the Uniform Health Insurance Policy Provision Model Act, which many states, including Arkansas, follow. The Contestable Period refers to the timeframe during which an insurance company can investigate and contest a claim based on misrepresentations made by the policyholder during the application process.

If a claim is made within this two-year period, the insurer has the right to challenge the validity of the insurance provided. This duration is intended to protect insurance companies from fraud and to ensure that only qualified individuals receive benefits from the policy. After this two-year window closes, the insurer generally cannot contest claims, provided that the policyholder has not committed fraud. This instills confidence in policyholders that their claims will be honored after the contestable period has elapsed.