Yes, life insurance can cover suicide. When a loved one passes away due to suicide, it can be challenging to know if their life insurance policy is still active. In most situations, beneficiaries can still obtain a payout despite the cause of death being suicide. However, it’s important to note that there are exclusions that could potentially nullify such claims.
Generally, life insurance does not cover suicide in the initial two years of the policy, but beyond the initial period, you get coverage. This sis known as the suicide clause. Moreover, if the policyholder dies by suicide more than two years after securing the insurance, the policy will disburse the death benefit to the beneficiaries.
What Is Life Insurance Suicide Clause?
A suicide clause is regularly in effect for a period of two to three years after a life insurance policy starts. Within this duration, the clause permits an investigation into the circumstances surrounding the insured’s death. Moreover, if the insurer, law enforcement, or medical examiner provides evidence that the policyholder’s demise is suicide during this specified period, the insurer owns the right to reject a beneficiary’s claim for the life insurance death benefit.
How Suicide Clauses Work
Numerous insurance providers offer a suicide clause, also referred to as a suicide provision, to prevent individuals from having a financial motive to end their lives. Moreover, the insurer will not disburse a death benefit if the individual dies by suicide within the initial two years of coverage, known as the exclusion period.
Once this exclusion period concludes, beneficiaries can obtain the death benefit in the event of the insured individual’s suicide. However, if any modification, like including coverage or changing a term policy into a whole life policy, can reset the timer, prompting the exclusion period to commence over.
When Does Life Insurance Cover Suicide?
Despite common belief, life insurance can indeed provide coverage for a policyholder’s death by suicide. In other word, you are not to violate some conditions. Additionally, it’s beneficial to check the policy for precise details.
However, it’s important to note that beneficiaries may still receive the death benefit in the event of suicide.
Military Life Insurance
Certain military life insurance policies stand out due to their feature of disbursing the death benefit to selected beneficiaries irrespective of the cause of death. These personnel include those provided by Veterans’ Group Life Insurance (VGLI) and Servicemembers’ Group Life Insurance (SGLI). Moreover, if the insured passes away due to an act of war or by suicide, their life insurance policy may still provide the death benefit to the beneficiaries.
Accidental Death
To determine if accidental death offers coverage by a life insurance provider or not is usually based on two factors. This includes the situation of the death and the information disclosed by the insured to their life insurance provider during the policy application process. For example, if the policyholder passes away due to drug overdose and had disclosed the prescription when applying for the policy, the beneficiaries could obtain the death benefit.
However, death resulting from an illegal drug overdose does not get coverage by life insurance policies. In addition, the majority of life insurance policies incorporate contestability periods and suicide clauses, which must end before coverage for suicidal death is activated. However, once these clauses have expired, beneficiaries may obtain the death benefit selected by the policyholder.
Life Insurance Death Benefit After A Suicide
While obtaining life insurance after a previous suicide attempt can be difficult, it is not impossible. However, the application process will involve manual underwriting. During this period, insurers will ask for details regarding the suicide attempt, including its timing, whether it was the first occurrence, and if the applicant is undergoing any treatment.
Revisiting such experiences during this evaluation may be distressing for some individuals. However, you cannot omit them. Furthermore, you can utilize the details to estimate monthly premiums depending on the type of risk the insurer associates with the applicant. However, these rates may be adjusted if the risk is minimal or if the insurer receives evidence of ongoing treatment.
How Does an Insurance Company Know If Someone Died by Suicide?
If a policyholder passes away and their beneficiaries submit a claim, the insurance provider will request a death certificate. Additionally, this document indicates the cause of death and states whether it was self-harm. Moreover, whether the death certificate is inconclusive or lists a questionable cause of death, the insurer may ask for extra documentation.
This documentation includes an autopsy report, a medical examiner report, an emergency medical services (EMS) report, or the deceased person’s medical records. Since investigating deaths by suicide could consume time, beneficiaries may encounter delays in getting the benefits from the life insurance policy. Although the claims process can be complex and time-consuming, beneficiaries should not be discouraged from filing a claim.
Lastly, it’s important to note that suicide is excluded from coverage during the initial two years of a life insurance policy, commonly known as the suicide clause period. However, if the initial period concludes, the policy will typically provide a death benefit for suicide.n
