A person insured under a Whole Life policy dies at age 50. The insurance company learns that the insured was three years older than the insured indicated on the application. Which of the following statements is CORRECT about this situation?

Voiding the policy completely is an extreme measure typically reserved for cases involving intentional misrepresentation or fraud. In this situation, where the insured's age discrepancy was likely unintentional, voiding the policy entirely would not be a common course of action.

While disputes over insurance payouts can sometimes lead to legal action, in this case of an incorrect age declaration, the beneficiary is not necessarily required to sue. The insurance company is expected to adjust the death benefit accordingly based on the corrected information.

The payment amount in this situation is not limited to only the face amount of the base policy. Instead, the death benefit is typically adjusted to reflect the correct age of the insured, ensuring that the payout accurately reflects the risk assumed by the insurer.