does life insurance pay for suicidal death

Does life insurance pay for suicidal death?

Generally speaking, life insurers pay out to beneficiaries almost every time. We use the word “almost” here because there are some uncommon situations where life insurance will not be given out.  

One of the most significant circumstances that we are referring to is suicidal death. Suicidal death may be excluded based on the terms and conditions of the suicide clause of your life insurance policy (which is usually effective during the first few years of the policy.)  

Once this clause expires, your life insurance policy will pay for suicidal death. 

What does a life insurance policy suicide clause mean? 

The life insurance policy suicide clause refers to a stipulation in a life insurance policy that takes effect within the first two years of the policy. 

What does this mean? This means that as long as you are the life insurance policyholder and die of injury that you make it happen to yourself in an intentional manner, the life insurer has the right to deny paying the death benefit to your designated beneficiaries.   

The purpose of this proviso is to reduce the risk for the life insurer in that it stops people who buy life insurance to commit suicide soon after the purchase so that their loved ones, be it their family members or best friend, can collect the face amount of the policy. 

In fact, this can also lead to challenges for the life insurer. For example, does life insurance cover death by drug overdose? This is the job of the life insurance provider to finalize whether this sort of death was intentional or unintentional.  

Keep in mind that, on the one hand, the life insurer will pay out a lump sum to your beneficiaries after the first two years of the life insurance policy. On the other hand, they may not pay out the death benefit as long as another stipulation or exclusion is present in the life insurance policy which makes it taboo.   

Can you get life insurance if you have depression? 

You can still get life insurance if you are depressed, depending on the nature of your mental condition, its causes and whether you are being treated for it or not. Your application for life insurance will be rejected if you are in a terminally ill status and considered too risky from the perspective of the life insurer.  

In accordance with the National Institute of Mental Health, the more you are depressed, the higher chance of suicide. When you apply for life insurance, it is best to be authentic with your mental health information.  

To be entitled for competitive premium rates, you need to submit proof of medical treatment through therapy and medication while answering questions such as the extent of your depression and the first time you were diagnosed with the mental condition. 

You should always be honest with your answers to avoid preventing your loved ones from collecting a life insurance payout. Be mindful of always revealing your mental health history otherwise there can be a refusal of the death benefit. 

Life insurance applications with mental health history can get complex and life insurers usually assess each and every application form case by case. 

Medically assisted suicide, also known as death with dignity or right-to-die circumstances, refers to an incident where people are diagnosed with a terminal illness who decide to die with the help of a doctor instead of suffering through medical treatment. 

This kind of suicide also falls under the same category as other ways of suicide. It is covered and the life insurer will pay out a lump sum of death benefit to your beneficiaries after the first two years of the life insurance policy.  

Individual Life Insurance Policies vs. Group Life Insurance Policies 

Typically, employer-sponsored life insurance policies have no suicide stipulations. This means that your beneficiaries will experience a much more hassle-free claims process than they would with an individual life insurance plan.  

However, with group life insurance policies, there will be a waiting period which lasts one or two years before the death benefits becomes valid.