Insurance - Tonight a dear friend killed himself. Will his life insurance pay off?

Question

someone made a comment like .. i see why he killed himself with such friends around.. what a terrible thing to say.. I am very worried about his wife and children. His wife is in a desperate situation now, yes his friends are hoping that there is something monetary that will help her and these children in this terrible times. Face it.. when these things happen you have to look at finances.. funerals cost several thousand dollars and raising 4 kids cost a lot more, so forgive me if hoping that there is money there for her at this time is such a terrible thing!

Answer 1

If his policy is new, less than two to three years old (varies by state) it is NOT going to pay out. Even if his policy is more than the 2-3 years old, there might be an absolute suicide exclusion on it.

No one here has any way of knowing that answer. His widow is going to have to go through the paperwork, file the claim, etc.

I hope she has lots of friends, family, and church members to lean on during this time. It's not easy.

Answer 2

The suicide clause is designed to prevent people who are contemplating taking their own lives from obtaining life insurance. To accomplish this, the clause states that if the insured commits suicide within a specified period of time, the policy will automatically be voided. The amount of time varies, but it's usually the same length as the incontestable period: one or two years. The clause applies whether the insured is sane or insane at the time of the act.

Once the mandated period of time has elapsed, the insurance company must pay the claim even if the insured commits suicide. However, if suicide occurs while the time limit is still in effect, the company will usually only refund any premiums that the policy-owner has paid for the coverage. Accrued interest on the premiums typically won't be refunded, as the company will use it to offset part of its costs in initially setting up the policy.

Although some states may not specifically mention the suicide clause in their laws, insurance companies generally use the silence as tacit permission to include the clause in their policies.

Answer 3

Suicide is generally a covered benefit when it comes to life insurance however can vary depending on the policy itself.

The contract will outline contestability and normally suicide is outlined. It will advised if the suicide happens within 1-2 years from the start of the contract it will not be covered. Group policies will be less restrictive.

Best thing to do is get everything in motion by obtaining the death certificate and submit the claim into the carrier. There is no penalty for submitting the claim and this will trigger the insurance company to take a position. The most likely event is that the carrier will pay the claim. If they deny, you can start exploring the fine print of the contract.

Answer 4

My condolences over the loss of your friend in such a tragic fashion. In response to your question, the answer lies in the insurance policy(s) itself. Some policies include an exclusion for payout in the event of a suicide, and others contain a 'waiting period' of a few years before they will pay out in the event of suicide. (Understandable, given that some suicidal folks would purchase a huge policy and then kill themselves shortly after taking the policy.)

Your friend's survivors should check into the life insurance situation as soon as they are able. Doubtless, at the moment they are in shock and dismay. Even if your friend's policy DOES pay out, it may take some time to receive the proceeds of the insurance.

Answer 5

His widow needs to check the clauses in his policy and when the policy was taken out. All policies have suicide clauses. She needs to check the length of the clause in her husbands policy. Most have a 2 year clause meaning if the policy holder commits suicide in the first 2 years of the policy the insurance company will not pay the face value of the policy.
If he has owned the policy for more than 2 years chances are she can collect the amount on her husbands policy.

Answer 6

Insurance is the best thing that a working spouse call buy for his/her family especially if they are not rich.
Poor people can't afford insurance, however, they are the ones that needs it the most.
I under stand your question because I was an insurance agent.
To answer your question, the beneficaries of the account will receive the pay off.
Also, since he killed himself, insurance company will not pay if he just purchased the insurance with in 2 years.
That the insurance industry law.

I recommend that everyone should have some life insurance to cover expenses like child care, mortgage, last expenses, college expenses and cost of living until the children finish college.
Estimate the minimum to the maximum to see how much you will need.
Don't count on employee insurance from the company, they are usually just 1 to 2 years salary.
Don't buy additional term insurance from employer's plan.
You can get a better rate by shopping around via quotesmith.com or insure.com.

After the calculation, if the amount is say to be $1,000,000.
$300,000 mortgage, $100,000 for each children's college cost, $30,000 last expense, $200,000 living expense for 10 years.
One million dollar whole life policy with cash value is going to be expensive.
I recommend a term policy for 20 or 30 years once a person starts a family.
With a 20 year policy, the children will be old enought to get a job.

Insurance needs change with every major event such as a new child, so buy or increase your coverage after a newborn.

One million dollar term is not expensive considering the protection the person gets.
Buy based on the situation if something happened to a spouse or both.

The reason why poor people needs insurance the most is because they are the blue collar working that's most in danger of an accident or crime.

I used to have $500,000 worth of life insurance ($200,000 from company).
After I left Prudential, I keep my whole life policy.
It was enought to protect my family because my mortgage was pay off and I have enought in my retirement account to support my son and wife.
You need to add up all the possible expenses and subtract all the savings to figure out the amount of insuarnce need.

You can figure it out in most insuarnce websites like Prudential, Metlife, etc...

Now, I don't need any insurance because I am financially settle.
However, there are other reasons to get life insuarnce such as estate tax that I won't go into.

Good Luck!

Answer 7

It will depend on the terms of the insurance policy. Some exclude suicide totally, others have an initial exclusion period such as two years. The specific policy has to be examined.

Answer 8

After a life policy has been in force for 2 years, it cannot be contested. So, yes, it would pay if it has been that long. If not, there is an exclusion for suicide.

I am sorry for your loss. The sad thing is that people that commit suicide are very selfish. They no longer feel any pain, but the ones that love them and are left behind have a tremendous amount of it to live with the rest of their lives.

Answer 9

It depends on the policy. Most do cover suicides but may have a 2 year waiting period. Have her check the policy or call the Insurance Carrier.

Answer 10

Usually life insurance does not cover suicide but some companies do depending on the circumstances. They are protecting themselves against people using them as a way to solve financial worries in a particularly awful way.

Only the policy will tell you if a payment might be made and in what circumstances. A particular issue will be whether there was some bad news like a terminal illness that made him do it - so it was that not the money.

I suspect that his family have been left in trouble however.