Does Life Insurance Pay for Suicidal Death? 

Losing a close family member through suicide is a difficult and traumatic experience. While grappling with the suicidal death of your loved one, the last thing you’d want to worry about is receiving payout from their life insurance policy. Many traditional life insurance policies come with a suicide clause, which means that if the insured dies by suicide within two years after the policy is issued, the death benefit could be denied or limited. If you suspect your life insurance payout is stalled or denied for unethical reasons, it is best to consult an insurance dispute lawyer to rule out any wrongdoing on part of your insurance company.

How Does Life Insurance Work?

After a loved one’s passing, life insurance is supposed to help ease financial anxiety and other uncertainties. For families who lose the breadwinner, a life insurance coverage can aid in debt settlement, estate planning, education expenses, and funeral arrangements. However, challenges may arise in the form of unpaid premiums, policy exclusions, or bad-faith insurance dealings that prevent beneficiaries from receiving the proceeds of the life insurance policy. In such cases, an experienced life insurance dispute lawyer can be your strongest ally in fighting for your rights.

Standard Exclusions In Life Insurance Policies

Like all insurance contracts, life insurance policies contain certain exclusions to eliminate coverage for certain types of acts, risks, or events. Some of the more common exclusions in life insurance policies are:

• Suicide clause: If the insured dies by suicide within the first two years of the policy, the death benefit is likely to be denied or limited to a return of premiums paid.
• Acts of war: Insurers generally don’t pay out the death benefit if the policyholder dies from war-related acts, like while serving in the military at the time of death.
• Other exclusions: Other examples of possible exclusions are high-risk activities, illegal acts, pre-existing medical conditions, and natural events.

Does Life Insurance Cover Suicide?

Most life insurance policies cover a wide range of causes of death, including suicide. However, there’s an important exception. While insurers are required to coverage beneficiaries for the self-inflicted death of the policyholder, they likely will not do so if it happens in the first two years of the policy. This period is known as the contestability period, and during this time, an insurer has the right to thoroughly investigate the death claim. If they discover information that should have been reported, such as underlying mental health conditions, addiction, substance abuse, or other dangerous behaviors, they have the right to deny the claim.

Life Insurance Suicide Clause

In the case of suicide, an insurance company may not pay the beneficiary if the policyholder dies during the contestability period. This is also known as the suicide clause.

Life Insurance Incontestability Clause

Once the policy takes effect, insurance companies have a window of time to investigate possible discrepancies or inaccuracies, such as omissions or misstatements. The time period is usually two years from the policy’s effective date.

Does Life Insurance Cover ‘Death With Dignity’ or Doctor-Assisted Suicide?

‘Death with dignity’ refers to the practice of ending a life peacefully and humanely. This happens when individuals with painful terminal illnesses can no longer bear the pain and may decide to end their lives.

Doctor-assisted suicide is only allowed in certain states like California or Washington. Most traditional life insurance policies do not explicitly exclude coverage for it. However, if the insured chooses voluntary euthanasia, the insurer may still investigate the policyholder’s death to make sure it complies with the policy terms. The insurer could deem the death a result of suicide, and coverage may be denied or limited depending on the suicide clause of the specific policy.

Is an Overdose Considered an Accidental Death?

Insurance companies must investigate the circumstances of the policyholder’s death before they determine whether it was accidental or intentional. Some policies have specific criteria that must be met before a death is considered accidental, such as whether it happened suddenly or unexpectedly due to a qualifying event. The insurance company will likely request a toxicology report to see if the cause of death was due to accidental ingestion of substances or medications that support the classification of the death as accidental.

Accidental death is typically sold as a package with dismemberment coverage, but there is a difference between the two. The beneficiary receives benefits if there is a loss of certain body parts or functions as a result of an accident. Accidental death, on the other hand, is specific to death resulting from events like car accidents, slips and falls, drowning, or other unexpected events.

Does Group Life Insurance Pay for Suicidal Death?

Group life insurance is a benefit an employer or organization offers its employees. In this case, the employer pays the premiums and the policy accordingly covers a group of people. An individual can have individual life insurance as well as group life insurance for additional coverage.

Group life insurance policies have a suicide clause.

Can I Be Denied Life Insurance Policy Proceeds?

Life insurance proceeds can be denied. Some denials are legitimate, like in case of policy lapses, material misrepresentations, or exclusions in the form of illegal activities or war.

In other cases, bad-faith insurers use elaborate methods to reject claims so they do not have to pay the proceeds. They might refuse to investigate a claim, stall the payout process, or avoid communication to avoid paying the beneficiary what they are due.

If you believe that your life insurance proceeds are being wrongly denied, you should contact a life insurance dispute lawyer for help.

My Life Insurance Claim Was Denied: Next Steps

A denied life insurance claim can be frustrating and stressful. Many individuals do not know what steps to take next, and some people quit altogether as they assume the insurance company is going to win. No does not always mean no, and there are steps you can take if your life insurance claim is denied:

• Carefully review the life insurance policy, corresponding documents, and the claim denial letter
• Gather documentation and supporting evidence, such as medical records, death certificates, and other related information
• Maintain all communications with the life insurance company in a safe and organized place
• If the insurer’s decision was unjustified, file and pursue an external appeal
• Consider legal assistance if unsure about your rights or how to proceed

How Can a Life Insurance Dispute Attorney Help?

If you have tried and failed to reverse a claim decision, it might be time to involve a life insurance dispute attorney. An experienced bad-faith insurance attorney can:

• Review the policy’s fine print, including its limitations and exclusions
• Review the claim denial letter
• Investigate the reasons behind the denial
• Use insurance dispute law and policy benefits to communicate your grievances with the insurer

Negotiate with the insurance company to help you get the best possible coverage and any additional compensation.

Life Insurance Lawyers Near Me

At Wallace Law, we help tired and frustrated policyholders get fairly paid for their insurance claims. We are a skilled insurance dispute firm serving policyholders throughout the Wisconsin area. We are located at 1414 N Taylor Drive, Suite 200, Sheboygan, WI – 53081. Our nearest landmarks are Marcus Sheboygan Cinema and Prevea Sheboygan Health Center.

Our Policy is to Fight For You | Contact Our Life Insurance Dispute Lawyers Today

Wallace Law is a reputed insurance dispute law firm with experience fighting unethical insurers. Our founder Justin Wallace has helped many clients recover their life insurance proceeds according to the terms of their policies. Reach out to us today for a free consultation.

Note: If you or someone you know is struggling with suicidal thoughts, please contact 988 Suicide and Crisis Lifeline.