Many life insurance policies cover deaths by suicide, but only after a certain period of maintaining the policy. Coverage of these types of death usually only begins after two to three years of enrollment due to two policy provisions: the suicide clause and the contestability clause. The contestability clause is a period that allows insurers to investigate the cause of death before paying out, and the suicide clause often overlaps with this.
Does Life Insurance Cover Suicide?
Updated: October 3, 2024
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IF YOU NEED HELP
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Key Takeaways
Most life insurance policies cover death by suicide, but only after a set period dictated by the contestability and suicide clauses.
The contestability clause usually lasts for at least two to three years. This allows insurers to investigate the cause of death and deny benefits within that period.
The suicide clause allows insurers to deny a death benefit if self-harm caused the death within the contestability period.
Does Life Insurance Cover Deaths by Suicide?
Generally, life insurance does cover suicidal deaths. However, there are stipulations tied to the timing and terms laid out by the insurance provider. Understanding these is necessary for policyholders and beneficiaries to ensure they are fully aware of the scope of coverage.
Life insurance policies often come with specific provisions that address the topic of deaths by suicide. These generally include two key clauses: the suicide clause and the contestability clause.
The suicide clause typically lasts for the first two years of the policy. It stipulates that if the policyholder dies by suicide during this period, the insurance company will not pay out the death benefit. Instead, the beneficiaries will receive a refund of the premiums paid. The contestability clause allows the insurer to investigate the circumstances of the death and the information provided during the application process. If the provider finds discrepancies or fraud, they may deny the claim.
Insurers can reset these clauses under certain conditions. For instance, if you decide to increase your coverage amount or change insurance providers, the two-year clock for the suicide clause may restart. We recommend reading the fine print and consulting with your insurance advisor when making any changes to your policy.
Life Insurance Clauses for Suicide
Policy Provision | Description | Waiting Period | Why It Exists |
|---|---|---|---|
Suicide Clause | States that an insurer will not pay out the death benefit if a policyholder dies by suicide within the first two or three years of coverage. | Around two to three years | Aims to prevent people from becoming financially motivated to take their own lives. |
Contestability Clause | Gives insurers the right to investigate for intentional errors after death within the first two years of the policy’s enrollment. | Two years | Allows insurers to look for misrepresentations during the application process to avoid fraud. For instance, if a person had a history of depression but purposefully concealed this, they can deny or reduce the death benefit. |
INSURANCE INVESTIGATIONS
To confirm the cause of death, insurers can ask for a death certificate. If a cause of death is deemed inconclusive or questionable, they can ask surviving family members or beneficiaries for additional documents. These include, but are not limited to:
- An autopsy report
- A medical examiner report
- An emergency medical services (EMS) report
- A copy of the policyholder’s medical records
In cases of death by suicide, life insurance investigations may take longer, which can delay death benefits.
Does life insurance cover physician-assisted suicide?
In states where they are allowed, doctor-assisted suicides, otherwise known as death with dignity or the right to die, also fall under the suicide clause. This means most insurers will not cover physician-assisted suicides within two to three years of the policyholder's enrollment. States that allow death with dignity include:
- California
- Colorado
- District of Columbia
- Hawaii
- Montana
- Maine
- New Jersey
- New Mexico
- Oregon
- Vermont
- Washington
Life Insurance Policy Types and Coverage of Suicide
Life insurance suicide provisions can vary based on the type of life insurance policy. Review the scenarios below to see the different clauses and when suicidal deaths are covered.
If you have term life insurance
Term life policies typically have an exclusion period, which is the first two or three years of the policy. If a policyholder dies due to suicide after the exclusion period, the beneficiaries will receive the death benefit. However, if a policyholder dies by suicide within the exclusion period, the insurer will not pay out. It's important to understand that while term life insurance does cover suicide, it depends on the timing relative to the exclusion period.
If you have group life insurance
Group life insurance policies, which employers obtain, do not contain a suicide clause. This means that if a covered employee dies due to suicide, their beneficiaries will receive the death benefit regardless of when they got the policy.
If you have military life insurance
Military life insurance policies work similarly to group life insurance in that they do not include a suicide clause. Beneficiaries of policyholders who die from suicide will receive the death benefit regardless of when the policyholder obtained the policy.
If you have whole life insurance
Under a whole life insurance policy, if a policyholder dies within the exclusion period, their beneficiaries might be entitled to the plan's cash value. Beneficiaries can receive the full death benefits after the exclusion period ends.
MONEYGEEK EXPERT TIP
If a policyholder has a whole life policy and dies from suicide within the exclusion period, their beneficiaries may instead receive the plan’s cash value. Once the exclusion period is over, beneficiaries can receive the full death benefits.
Can Life Insurance Deny Coverage Due to Mental Health?
Insurers can deny an application for life insurance based on a person's health, be it physical or mental. If a person has serious mental health complications, then insurers may reserve the right to deny life insurance coverage as the policy would be deemed high risk.
MONEYGEEK EXPERT TIP
If a life insurance provider denies your application due to a mental health condition, you can still opt for a no medical exam, simplified issue or guaranteed acceptance policy. Unlike most life insurance policies, no-exam policies do not include health exam requirements.
Simplified issue life insurance has minimal health questions but higher premiums. Guaranteed acceptance policies are the same, but grant a policy immediately — no questions asked.
Life Insurance Coverage After an Overdose
Whether life insurance will cover an alcohol or drug-related death depends on the circumstances and the policy’s inclusions. Check out the table below to view different scenarios and whether a provider would cover them.
How an Overdose Affects Life Insurance
Cause of Overdose | Effect on Life Insurance |
|---|---|
Prescribed Medication | Insurers will cover death by an accidental overdose of a prescribed medication if the policyholder discloses the drug and the reason behind it during the application process. If the policyholder did not disclose it, insurers may contest the claim within the exclusion period. |
Illegal Drugs | Providers will typically deny a claim related to an illicit drug overdose within the contestability period. The payout will still depend on the insurer if the death occurs after the exclusion period. If the policyholder disclosed a history of drug abuse during the application, the beneficiaries may be able to receive the death benefit. |
Alcohol | Alcohol-related deaths are often handled similarly to fatalities related to illegal drug abuse. If the policyholder disclosed an alcohol use disorder or other information during the application period, then insurers will typically pay out the death benefit. |
How to File a Claim After Death by Suicide
Below, we outline the steps to take to file a life insurance claim after a death by suicide to prepare you and help ensure a smooth process:
1
Obtain the Death Certificate
Secure an official death certificate from the local vital records office. This is the foundational document for initiating the claim process, which is essential in cases where life insurance does cover suicide.
2
Contact the Insurance Provider
Notify the insurance company about the policyholder's death and request the necessary claim forms.
3
Complete the Claim Forms
Once you're sure that the life insurance does cover suicide, fill out all the required forms accurately. Errors or omissions can result in delays or outright denial of the claim.
4
Submit Supporting Documents
Alongside the claim forms, submit the death certificate and any other documents the insurer may require.
5
Wait for Approval
After submission, the insurance company will undertake a review process, which can vary in duration.
6
Receive the Payout
If the claim is approved, the beneficiaries will receive the death benefit specified in the policy.
Common Mistakes to Avoid When Filing a Claim
Avoiding common mistakes can significantly improve the chances of your issuer approving your claim. Here are some to look out for:
Incomplete Paperwork and Insufficient Documentation
Double-check all forms for completeness and accuracy before submission. Submit all required documents, including any additional evidence that could strengthen your claim.
Delay in Filing
Time is of the essence. File the claim promptly to avoid complications related to deadlines.
Ignoring Follow-Ups
Maintain open lines of communication with the insurance company and swiftly respond to any requests for further information.
What to Do if the Insurer Denies Your Claim
Sometimes, the insurance provider may decide to deny a life insurance claim. In such instances, there are actionable steps you can take to challenge the decision:
1
Review the Denial Letter
Thoroughly read the denial letter to understand the insurer's reasons for rejecting the claim.
2
Gather Evidence
Assemble all pertinent documents, such as medical records and correspondence, that can support your case.
3
Contact the Insurance Company
Engage with a claims representative to discuss the denial and explore your options.
4
File an Appeal
Submit a formal appeal with all supporting documents to the insurance company.
5
Seek Legal Counsel
If the appeal is unsuccessful, consulting with an attorney experienced in insurance claims may be advisable.
FAQ About Life Insurance Coverage of Suicidal Deaths
Understanding when life insurance pays out can be confusing — especially if you are already going through a tumultuous time. Review the most frequently asked questions below about life insurance and deaths by suicide.
Does life insurance cover suicide?
Yes, life insurance does cover suicide, but it depends on the policy and its clauses. Typically, life insurance policies will cover suicidal death if it occurs after the exclusion period, which is after the first two or three years of the policy.
Does term insurance cover suicide?
Yes, suicide is covered by term insurance after the suicide clause's exclusion period, which typically spans the first two years.
What is the purpose of a suicide provision within a life insurance policy?
The suicide provision prevents fraudulent claims by not covering suicide within the initial years (usually two) of the policy, ensuring that life insurance covers suicide only under fair circumstances.
Does life insurance cover alcohol or drug overdose?
Whether a life insurance policy will cover an alcohol or drug overdose depends on the circumstances. If the policyholder disclosed issues with these substances before or during the application process, their beneficiaries may receive the full death benefit.
Does life insurance cover physician-assisted suicide?
The treatment of physician-assisted suicides in life insurance policies may vary by insurer and jurisdiction. Generally, they are likely to fall under the suicide clause in states that allow doctor-assisted suicides.
Does suicide void life insurance?
Suicide can potentially void life insurance coverage, but it depends on the terms and conditions outlined in the policy. Most life insurance policies have a suicide clause that restricts coverage within a certain period after the policy is purchased. If the policyholder dies by suicide during this period, the insurance company may not pay the death benefit.
Can a spouse collect life insurance if the policyholder dies by suicide?
A spouse can collect life insurance if they are the beneficiary and the death by suicide occurs after the exclusion period specified in the policy.