Question

An insured has had a life insurance policy that he purchased 3 years ago when he was 40 years old. He is killed in an automobile accident and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do?

Answer 1

Answer: Pay a reduced death benefit.

Step-by-step explanation:

The insurance company would still go ahead to pay out his benefits, because he never defaulted on his payments even though he falsified his age during the time of buy the insurance policy. What the company would do, would be to pay out a reduced death benefit after his accident as against the original sum he would have received.