Insurance policies are meant to ensure the future well-being of one’s family in the case of passing. But many conditions are applicable in the policy, and this term can restrict the coverage from being released to the beneficiary. Suicide is one of the examples where the condition may differ for the policyholder. Here, a common question arises: Does Term Life Insurance Pay Out for Suicidal Death?
Don’t get confused; from here, we will understand the details we need to know about this scenario. There are various rules and legal factors are involved. Let’s Start.
Suicide Clause in Life Insurance Policies
A term life insurance or any life insurance policy is meant to provide financial support to the family if the policyholder passes. With this, almost every insurance policy has a clause known as the ‘Suicidal Clause’. This specifies the behaviour of the insurance policy in the case where the reason for death is suicide.
This clause prevents the insurer from being defrauded by an applicant who buys the policy with the intention of suicide. The common terms of a suicide clause are as follows:
Within the First Two Years: Generally, all insurance companies have a fixed time of usually 1 to 3 years, and mostly 2 years, during which any suicidal death is not acceptable for providing any coverage to the beneficiary.
After This Period: If the policyholder dies after the first two years by suicide, then the insurer must pay off the coverage amount legally to the beneficiary because the question of legitimacy is not applicable here after years.
What Type of Death is Not Covered in Term Life Insurance?
The concern, does term life insurance pays out for suicidal death, will be solved after we understand which causes of death are generally not covered in a life insurance. In addition, some causes are not covered under the term life insurance policy. While the most common causes are:
- Criminal Activity: If the policyholder dies in the course of criminal or illegal activity, like robbery, felony, then the insurer company may refuse to release the coverage amount.
- Drugs and Alcohol: If the cause of death is extensive consumption of drugs and alcohol, then the insurer will not provide any death benefits.
- Dangerous Activities: Activities like skydiving, bungee jumping, or any other dangerous activities you are involved in may be excluded from the policy until a specific note or document is there.
- Hidden or Pre-Existing Conditions: The insurer may refuse to pay the coverage amount if the cause of death is due to any hidden information about the pre-existing medical issue which are not disclosed during the application period.
- Suicide During the Fixed Period: If the policyholder committed suicide during the fixed period of 2 years or 3 years, then the coverage amount will not be given.
What Should The Beneficiary Do After a Suicidal Death?
Does term life insurance pay out for suicidal death? The answer is Yes. But what the beneficiary needs to do:
- Locate the policy documents: Confirm the start date and terms.
- Check the suicide clause: See if the 2-year window has passed.
- Gather required documents: This includes a death certificate and possibly a coroner’s report.
- Contact the insurer: File a claim and submit all paperwork.
- Be patient: Suicide claims often undergo additional review and may take longer to process.
Other Life Insurance Policies Pay Out For Suicidal Death
Does term life insurance pay out for suicidal death? Yes, but not only with term life insurance. We have considered term life insurance a good option, but there are other variants of life insurance policies available that provide suicidal death benefits as well. And almost all life insurance policies consider suicidal death as a normal cause of death after 2 years, including:
- Term Life Insurance
- Whole Life Insurance
- Group Life Insurance
- Universal Life Insurance
The key factor is always timing. This two-year suicide clause almost applies to every type of policy, but once it expires, the suicide will not be disqualified from the acceptable causes of death.
When Life Insurance Might Not Pay Out
As the question does term life insurance pay out for suicidal death is solved, then you may need to know that in what circumstances the insurance policy may not pay the coverage amount to the beneficiary. The situations are mentioned below:
- False or Fraud Application Info
The details you filled out during the application matter the most. If, after buying the insurance policy, the insurer finds any hidden or unmentioned information related to the applicant’s health, medical history, or other aspects, then your policy can be terminated.
- Policy Lapse
If the policy wasn’t active at the time of death due to unpaid premiums, no payout will be made.
- Death During Illegal Death
As mentioned before, death due to any illegal or criminal activity will cause you to lose coverage.
Conclusion -Does Term Life Insurance Pay Out For Suicidal Death?
Does term life insurance pay out for suicidal death? Yes, after the suicidal clause expired. The suicidal clause is a protection for the insurer to prevent any fraud or abuse. This suicidal clause is usually of 2 years from the date of start of the term insurance policy.
In such a busy lifestyle, there will be anything can happen. Besides stress and tension, an individual must think about their families and ensure their financial well-being will continue. If you’re unsure about the condition and other factors about the insurance policies. Then first consult an expert insurance advisor or company before making any assumptions.
This article is meant to help people understand the policies easily. If you find it relevant and helpful, then please share it with your friends and family on social media.
Frequently Asked Questions
Is suicidal death covered in term insurance?
Yes, suicidal death is covered in term insurance, but only after the suicidal clause period or the exclusive period of two years.
What type of death is not covered in term insurance?
If the death occurs due to any criminal activity, illegal practices, drug or alcohol consumption, or any other uncertain act will not be covered under any life insurance policy.
Does insurance pay out for suicidal death?
Yes, all life insurance policies pay out for suicidal death, but only after a fixed two years of period. The suicidal death may not always covered in a life insurance plan.
What type of death voids a life insurance policy?
Death related to criminal involvement, illegal practices, or death when the policy is paused because you didn’t pay the premiums.
Can life insurance payout be denied?
Life insurance payout can be denied if you have provided false information in the application, committed any fraud, or have unpaid premiums.
