If there is a misstatement of age when taking out an insurance policy, what will the insurance company pay upon the insured's death?

When there is a misstatement of age in an insurance policy, the insurance company typically pays an amount that is adjusted for the insured's correct age at the time of underwriting. This means that if the insured misrepresented their age when applying for the policy, the insurer will calculate the benefits based on the premium that would have been charged for the correct age.

For instance, if the insured had understated their age, making them appear younger and potentially securing lower premiums, the company would adjust the payout based on what the premium should have been for their actual age. Therefore, the benefit amount paid upon the insured's death would reflect this adjustment rather than simply the full face amount of the policy, ensuring that the insurance company is not financially penalized for a misstatement that could significantly affect risk assessment and pricing. This adjustment process helps maintain fairness in the risk pool for all insured individuals.