After how many years does an annuity become incontestable?

An annuity becomes incontestable after a period of two years, which aligns with the provisions set forth in Arizona law. This means that once the annuity has been in force for two years, the insurer generally cannot contest or challenge the validity of the policy or the truthfulness of statements made in the application, except for specific circumstances such as non-payment of premiums or material misrepresentation.

The two-year incontestability clause is a consumer protection measure designed to ensure that policyholders have some level of security in their investments after a defined time period. This legal framework encourages insurers to conduct thorough initial assessments and prevents them from arbitrarily contesting claims after the policyholder has held an annuity for a significant duration.

This timeframe is standard within many jurisdictions, making it a notable aspect of annuity contracts and insurance law, providing peace of mind to policyholders who have met the duration requirement.