State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 3/5
Under California Insurance Code Section 10350.2, after a disability policy has been in force for two years, the insurer generally:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
CIC Section 10350.2 (Form A) provides that after two years from the date of issue, no misstatements made by the applicant, except fraudulent misstatements, may be used to void the policy or deny a claim for loss incurred or disability commencing after the two-year period. The same provision bars denial based on a preexisting disease or condition not excluded by name or specific description. The incontestability clause creates certainty while preserving the fraud exception.
Why the other options are wrong
- B) After two years the insurer is barred from contesting on nonfraudulent misstatements; fraud is the only remaining basis.
- C) The statute concerns contestability, not premium; it contains no premium-reduction requirement.
- D) Section 10350.2 does not convert policies to noncancelable status; renewability is governed by separate policy provisions.
Memory hook
Two years of peace: innocent mistakes stop mattering. Only fraud keeps the contest door open.