Provided none of the policy’s exclusions are triggered, life insurance can cover suicidal death. Once the suicide provision and contestability clause have expired, a few other exceptions could affect a beneficiary’s claim. If you’ve lost a loved one to suicide who has left behind a life insurance policy, you could receive a death benefit payout.
While money likely is not your immediate concern, it is essential to remember that the policyholder purchased their life insurance policy to help reduce your financial burden after their death. Therefore, you will want to make sure the life insurance policy covers suicide. With a funeral to prepare and your own future to consider, a beneficiary’s claim to the life insurance death benefit could be a major comfort. Any delay or denial of payout could cause undue hardship.
According to the National Center for Health Statistics (NCHS), the suicide rate increased by 37% in the United States from 2000 through 2018. Though the rate dropped 5% between 2018 to 2020, it returned to its peak in 2021.
The suicide rate is higher among men than women. With the prevalence of suicidal death in the U.S. — especially among age groups more likely to have health insurance — many insurance companies are keen on protecting themselves financially from fraud.
Whether the life insurance death benefit will be paid after a suicide usually depends on the policy’s exclusions and when the death occurs. If insurance companies don’t include adequate provisions in their policies, cases of misrepresentation and fraud on life insurance applications could become a drastic issue.
Considering the high rates of suicide, insurance companies must be careful in case people are purchasing policies with ill intent. Today, most life insurance policies have a contestability period of around two years. A policy may even include a specific suicide clause that must expire before you can receive a payout for a suicidal death. So long as said provisions are in effect, the insurer can deny your claim when the policyholder’s death is ruled intentional.
The incontestability clause provides that once the set amount of time has passed, the insurer can’t contest or deny a claim except in serious cases. The insurance company can only challenge a claim if they discover fraud material misrepresentation or fraud. When the incontestability clause is in effect, circumstances involving suicide or minor misstatements in the application can’t affect your life insurance claim.
However, before the incontestability clause kicks in, the insurer typically has two years to contest a claim for various reasons. If the insurer believes the cause of death was suicide, they can choose to investigate during the contestability period. A claim could be denied when it’s proven the policyholder took their own life intentionally.
The contestability provision also addresses other events which could void coverage during the waiting period. For example, inaccurate information in the life insurance application is a common cause for claim denial. Withholding vital information relevant to the insurer’s decision to issue the policy, such as a diagnosis of illness, could also lead to the beneficiaries’ claim being denied.
Once a policy’s exclusionary provisions expire, the policyholder’s life insurance will cover suicidal death in most cases. So long as there’s no evidence of fraud or misrepresentation, the death benefit should be paid to the beneficiaries just as it would be for a death caused by an accident or illness.
However, if a policyholder’s suicide does occur during the two-year exclusionary period, the insurance company can choose to contest your death benefit claim. In the event a suicidal death is denied coverage, the life insurer may decide to return the premiums already paid before the policyholder’s death to the beneficiary. There’s also a chance you’ll receive the full payout, depending on the insurer.
It’s essential to check your loved one’s life insurance policy before making a claim. Some insurance policies may have a longer waiting period of three years. Meanwhile, others could have lapsed, causing the suicide clause and contestability period to reset at the time of reinstatement. These stipulations could easily impact whether you receive the payout.
In general, most life insurance policies cover death by suicide, but there may be certain limitations or exclusions depending on the specific policy and the circumstances of the death.
Some life insurance policies include a suicide clause, which typically states that if the insured dies by suicide in a certain amount of time prior to the policy being purchased, often about two years, the policy will not pay out a death benefit. This is done to prevent someone from buying a life insurance policy with the intention of committing suicide shortly thereafter to provide financial support to their beneficiaries.
However, after the suicide clause period has passed, most life insurance policies cover death by suicide like any other cause of death, as long as the policy is in force and the premiums have been paid up to date. Keep in mind that there may be certain exceptions or exclusions depending on the policy, so it’s always a good idea to review the terms and conditions of your specific policy or consult with your insurance provider for more information.
The specific terms and conditions of a life insurance policy can vary depending on the insurer and the specific policy. However, many life insurance policies have clauses that specify certain circumstances under which the policy won’t pay out the death benefit. Suicide is one of the circumstances that can void a life insurance policy.
If a policyholder dies by suicide within a certain period of time after the policy goes into effect, the life insurance company may not pay the death benefit to the beneficiaries. Suicide clauses and other policy exclusions can vary widely depending on the insurer and the specific policy. It’s always a good idea to carefully review the terms and conditions of any life insurance policy before signing up to understand any exclusions or limitations that may apply.
If you have questions or concerns about your life insurance policy, we recommend consulting with your insurance provider or a financial advisor for guidance.
The impact of suicide on life insurance depends on the specific terms and conditions of the policy, as well as the circumstances of the suicide.
If a life insurance claim is denied after a suicide, the first step is to review the policy documents and understand the reasons for the denial. If you believe that the denial of the claim was not justified, you can appeal the decision.
The appeals process will depend on the insurance company and the specific policy, but it typically involves submitting a written appeal with supporting documentation, such as medical records or a death certificate. Provide as much information as possible to support your case.
If the appeal is still denied, you may have the option to file a complaint with the state insurance regulator. This can help to escalate the matter and may result in the insurer being required to provide more information about their decision or reconsider their denial.
Most life insurance policies cover death by suicide, but there may be certain limitations or exclusions depending on the specific policy and the circumstances of the death. If you’re specifically looking for a life insurance policy that covers suicide, here are some steps you can take:
Remember that suicide prevention and mental health support should always be a top priority, and life insurance shouldn’t be relied upon as a solution to these issues. If you or someone you know is struggling with mental health concerns, there are resources available, such as counseling, therapy and crisis hotlines, that can provide support and assistance.
Life insurance policies cover most deaths caused by illness and accidents. However, particular exclusions in the policy could still cause complications depending on the death’s circumstances. If your loved one documented and disclosed all vital information to the insurer, most policies should extend coverage for overdose and alcohol-related deaths, too.
An accidental drug overdose, such as an unintentional death caused by taking more than a prescribed medication’s recommended amount, is usually covered by life insurance. In this case, the policyholder should have disclosed all medications, including the purpose for each drug’s prescription. If this information was withheld when the policy was purchased, the insurer could contest your claim during the exclusionary period.
If the contestability clause is in effect, the insurance company can also investigate an accidental overdose if there is suspicion that it was intentional. Since there is no way of knowing the insured’s intent after their death, both the beneficiaries and the insurer will require evidence to support their case. If the insurer can demonstrate enough proof, life insurance may not always cover an accidental overdose.
Coverage for alcohol-related deaths is similar. Applicants should disclose all information about their drinking behavior, mental health, history of alcohol abuse and potential treatment at the time of purchase. If this information is withheld, the insurer could have reason to deny a beneficiary’s death benefit claim. Alternatively, the insurer can investigate whether the policyholder tried to kill themselves intentionally, as long as the contestability clause is active.
When your loved one initially purchased their policy, the insurance company would have required vital information about their current health and health history. This includes information about their mental health. Life insurance questions may involve topics of suicidal thoughts, diagnosis of depression and history of treatment. This is because depression is a leading cause of suicide and a potential risk for life insurance companies to insure.
The insurance company is responsible for determining how much of a risk each applicant is before offering coverage. The application process helps insurance companies determine whether they will insure a particular applicant. There must be an assurance that the applicant isn’t purposefully seeking life insurance to commit fraud. If the insurance company is willing to work with an applicant, the information provided may affect the policy’s death benefit, premiums and exclusions.
Suppose your loved one was experiencing depression when they applied for life insurance or had a prior history of depression. In that case, they should have disclosed the severity of the depression, when they were first diagnosed and any evidence of therapy, medication or other treatment. Insurers consider each application on a case-by-case basis, so it benefits applicants to be completely honest about their mental health.
A record of treatment for depression or anxiety can still make you eligible for competitive insurance rates.
While life insurance policies vary by provider and type, some types of deaths are typically not covered by life insurance. Beyond suicide, below are a few other examples:
Carefully review the terms and conditions of a life insurance policy to understand what types of deaths are covered.
The life insurance policy should cover most causes of death as long as there are no active exclusions. However, if the insurer suspects misrepresentation or the exclusionary period has not yet expired, your life insurance claim could be denied after a suicidal death. The best thing a policyholder can do to prevent claim denial is to disclose any relevant knowledge at the time of purchase. Withholding or providing inaccurate information can easily lead to a beneficiary’s claim being rejected.
When applying for life insurance, all applicants should be honest about the following records and information:
Another factor that could lead to claim denial is whether the insured’s death occurred within the incontestability period or the suicide clause waiting period. Insurance companies typically defer to law enforcement and medical examiners to declare a policyholder’s cause of death. However, even if the death is not ruled a suicide, the insurer has the right to launch their own investigation. Your claim could be denied if proof exists that the policyholder died by suicide during the exclusionary period.
While insurers bear the burden of proof to demonstrate the policyholder died by suicide, you can contest a denied life insurance claim if you believe their reason is incorrect. Insurance companies often turn their investigative attention to the following items when making a conclusive decision:
If you disagree with an investigation’s finding of suicide and believe the claim denial is unwarranted, you can contest the insurer’s decision. Consider bringing legal action to help present your own evidence and increase the likelihood of receiving a payout.
Physician-assisted suicide, also called “death with dignity,” refers to a situation in which a person deemed terminally ill chooses to legally and voluntarily die rather than experience a diminished quality of life. Life insurance policies typically treat physician-assisted suicide like other deaths by suicide, meaning the policy should cover doctor-assisted suicide as long as the suicide clause and contestability clause have expired.
While physician-assisted suicide is becoming more accepted in today’s world, most U.S. states don’t have a precedent for this new method of self-inflicted death. Certain states have life insurance suicide laws protecting the insured’s death from being claimed a suicide if the resident chooses to exercise their right to die. When there’s a death with dignity law in place, the life insurer should cover your death benefit claim — even during the suicide clause waiting period.
State laws for physician-assisted suicide have been passed in:
Consult the policy documents to ensure there are no additional exclusions that could void coverage. For example, an illegal activity clause could lead to a claim denial if the policyholder died from a physician-assisted suicide that didn’t comply with proper regulations.
Group life insurance covers suicide differently from an individual life insurance policy. If your loved one has group life insurance entirely paid for by their employer, it will usually cover suicide with no restrictions. The two-year contestability period and suicide clause waiting period will not apply with group life insurance. This means a group policy will payout at any time when your loved one passes away from suicide.
For many people, life insurance is intended to help reduce or eliminate their family’s financial burden after they’re gone. That’s why it is crucial to secure the right life insurance policy if there is a risk of suicide.
If a covered person leaves behind a life insurance policy after their intentional death, our goal is to assist their loved ones and beneficiaries through the residual hardship. We understand that every situation is different, so we aim to help beneficiaries make their claim by answering any questions regarding life insurance or providing the details needed to address any issues with the insurer.
Contact David Pope Insurance for life insurance advice today. We can answer your questions about how a life insurance policy should be handled following your loved one’s death or help you find suitable life insurance for yourself in preparation for your family’s future.