A policyholder understated the insured's age so the premiums were set as if for a younger person. Years later, after the contestable period has run, the insured dies and the insurer confirms the age error. What is the insurer's proper course under 40 P.S. § 510(e)?

Why D is correct

40 P.S. § 510(e) keeps the misstatement-of-age remedy alive after the contestable period, but reshapes it: the policy is not voided and the claim is not denied, because the insurer instead pays the amount the premiums would have purchased had the true age been given. Incontestability under 40 P.S. § 510(c) does not force the insurer to pay a benefit priced on false data; it only bars using the misstatement to void the policy. This adjusted-benefit outcome is the precise pairing of the two provisions that the Pennsylvania Insurance Department's outline highlights.

Why the other options are wrong

• A) Denial is the contestability-style remedy, but 40 P.S. § 510(e) substitutes an adjusted benefit for denial where age alone was misstated.
• B) Rescission is unavailable for age misstatement; the statute expressly operates by adjustment, not by voiding the policy.
• C) Incontestability does not convert the misstatement into full payment; it bars voiding, while 40 P.S. § 510(e) still requires the benefit to be repriced to the correct age.

Memory hook

After two years the policy stands, but the payout gets the true-age haircut.