Final answer:
If the health insurance policy is issued after unintentional non-disclosure of a visit to a neurologist, the insurer must contest the policy within the contestability period, typically two years, unless the non-disclosure was fraudulent.
Step-by-step explanation:
When an applicant for a health insurance policy fails to disclose a previous visit to a neurologist, and if the policy is issued without this information, the insurer has a limited time frame, known as the contestability period, during which it can contest the policy based on this nondisclosure. This period typically lasts two years from the date the policy took effect. Once the contestability period has expired, the insurer generally cannot contest the policy unless the nondisclosure was fraudulent. Therefore, if an insurer wants to contest the policy due to the applicant's unintentional nondisclosure, it must do so within this period.
Insurance policies are based on the principle of utmost good faith, where both parties are expected to fully disclose any information that can affect the terms of the policy. The applicant's knowledge about their health history is crucial for the insurer to determine the appropriate coverage and premiums. In cases of adverse selection where riskier individuals are more likely to buy insurance, accurate information becomes even more critical to maintain a sustainable insurance market.