Sadly, suicide is all too common: in fact, it’s the 10th leading cause of death overall in the United States. Many people think that if someone commits suicide, not only will their family be experiencing unimaginable grief, but their family will also be unable to access their life insurance benefits, because it’s a common misconception that suicide is not covered under life insurance. But that is not necessarily the case: when it comes to suicides, the reason life insurance companies have a “suicide clause,” or an exemption for death by suicide, is to prevent people from buying policies immediately before taking their lives so that their families can receive financial benefits – but that doesn’t mean that suicide is never covered by life insurance.
When Does Life Insurance Cover Suicide?
Suicide rates increased around 1% every year in the U.S from 2000-2006, and have increased 2% each year after 2006; because of this, life insurance companies have actually changed their policies: while at one point, they never paid out benefits in cases of suicide, most are now better prepared to help family members if it does happen. Life insurance policies now cover suicidal death, as long as it occurs within certain periods:
Life Insurance Suicide Clause
This clause is a provision put into most life insurance policies that outlines the specifics of your coverage if you were to commit suicide. Generally the clause is a 2-3 year exclusion period, which means once you have had the policy for 2-3 years, depending on the insurance company, your family will receive your death benefits even if you commit suicide. On the other hand, if you were to take your own life during that 2-3 year period, the insurance company would have the ability to investigate your death and deny coverage, meaning your beneficiaries would only get a refund on premiums paid towards the policy, not the death benefit. This is meant to prevent any applicant from taking out a life insurance policy and then taking their life immediately after.
In addition to the suicide clause, all life insurance policies have a contestability period, which is also generally the first 2-3 years of the policy. During this period, the insurance company has the ability to contest or deny a claim for a number of reasons, including if they believe you lied on your application, committed an illegal act that led to your death, or that you committed suicide.
Does Life Insurance Cover Physician-Assisted Suicide?
As long as your policy’s contestability and suicide clauses have expired, your life insurance policy might cover physician-assisted suicide, which is generally defined as someone dealing with a terminal illness giving permission to their doctor to administer lethal doses of medication to end their life. There are currently 11 states, and Washington D.C., that have laws protecting the right to assisted suicide:
- New Jersey
- New Mexico
Make sure to check with your life insurance company if you have any questions about coverage, and always be honest when filling out your application. If you have a terminal illness, most companies will deny coverage, but some might still allow you to purchase a policy; however, if you lie about your medical condition, that is grounds for the insurance company to claim fraud, which would leave your family with nothing.
Payouts For Suicide
Before you can purchase a life insurance policy, the insurer will conduct an analysis of your physical and mental health. If you are living with depression, you will most likely be able to get a policy as long as you are getting treatment and taking your medication, but the rates and coverage you will be offered will be determined on a case-by-case basis. In addition, if you do not disclose any mental health conditions when you first apply for your policy, your insurance company could deny payouts in the event of a suicidal death.
If you are in crisis, call the toll-free National Suicide Prevention Lifeline at 1-800-273-TALK (8255) – this service is available to anyone, 24 hours a day, 7 days a week. All calls are confidential.
If you are looking for a life insurance policy, the best way to find the right one for you and your specific needs is by working with an agent who specializes in life insurance. We have provided the top life insurance companies in the nation below; each offers hassle-free assistance and the most competitive rates. Always check multiple sites to make sure you have bargaining power and know the advantages of each company. Make sure a hard time isn’t made harder by a financial burden, check life insurance rates today.