The normal rule is that after a specified period of time, insurance companies cannot contest the validity of a life insurance policy for any reason except nonpayment of premiums. Do you think this rule encourages people to hide facts from the insurance company until their policy is incontestable? And is it ethical to hide facts that would otherwise invalidate an insurance policy? Support your answer with an example. What do you think is the reason for this rule?

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter9: Decision Making Under Uncertainty
Section: Chapter Questions
Problem 75P
icon
Related questions
Question

 

This is a business Law Question (option not available)

The normal rule is that after a specified period of time, insurance companies cannot contest the validity of a life insurance policy for any reason except nonpayment of premiums.

Do you think this rule encourages people to hide facts from the insurance company until their policy is incontestable? And is it ethical to hide facts that would otherwise invalidate an insurance policy? Support your answer with an example.

What do you think is the reason for this rule?

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Introduction to Business presentation
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Practical Management Science
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,