Is Suicide Covered by Life Insurance?
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TAKEAWAYS IMPORTANT
- A suicide clause or provision is found in many life insurance plans.
- If a policyholder commits suicide within the first one to two years of coverage, most companies will not pay a death benefit.
- The suicide exclusion period can be restarted by changing a policy.
- If the cause of death is suspected to be suicide, insurance companies may request extra paperwork.
Suicide Clauses in Action
Insurance companies don't want people to have a financial incentive to commit suicide. That's why a suicide clause, sometimes known as a suicide provision, is included in many life insurance plans.
Insurance companies normally do not pay a death benefit if a covered person commits suicide within the first two years of coverage—commonly referred to as the exclusion period—as stipulated in their suicide clause. If the covered person dies by suicide after the exclusion period ends, the policy's beneficiaries may be eligible for a death benefit.
The exclusion period is shorter in Colorado, Missouri, and North Dakota; after the insurance has been in place for one year, the beneficiaries are entitled to the death benefit if the covered person commits suicide.
Any policy modifications, like as adding coverage or changing a term policy to a whole life policy, might restart the clock and cause the exclusion period to begin all over again.
Suicide provisions may differ depending on the type of insurance you have:
Life insurance for a group
Unlike most individual life insurance plans, many group life insurance policies (the kind that people commonly acquire through their companies) do not have a suicide clause. If an insured person commits suicide, their beneficiaries are usually entitled to the death benefit.
Term Life Insurance is a type of life insurance that lasts for
Beneficiaries of individual term life insurance can collect the death benefit as long as the exclusion period has passed. The beneficiaries are entitled to the full benefit if the policyholder dies after the policy has been in existence for one to two years. However, if the person dies during the exclusion period, the beneficiaries may only receive the amount of premiums paid up to that point.
Insurance for the rest of your life
Even if the covered individual dies during the exclusion period, the beneficiaries of whole life plans may receive the plan's cash value. When the exclusion period expires, the beneficiaries are eligible to receive the entire death benefit as well as the cash value.
How can an insurance company tell if a person committed suicide?
The insurance company will require a death certificate when a policyholder dies and their beneficiaries submit a claim. The reason of death would be listed on the death certificate, as well as if the death was self-inflicted.
The insurance company may request additional evidence, such as an autopsy report, a medical examiner report, an EMS report, or the person's medical records, if the death certificate is inconclusive or includes a disputed cause of death.
Because suicide deaths often take longer to investigate, beneficiaries of life insurance policies may face a delay in receiving benefits.
Beneficiaries should not be discouraged from filing a claim because it is more complicated and time-consuming. They may be eligible for benefits to assist them financially while they heal from the catastrophe.
Anyone who is thinking of committing suicide can get help here.
Get help right now if you or someone you know is suffering from depression or mental health difficulties. You're not on your own. If you or a loved one is thinking about suicide, call 1-800-273-8255 or speak online with the National Suicide Prevention Lifeline. It's open 24 hours a day, seven days a week, and offers free, confidential assistance.
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