I was reading that, unlike in the movies, life insurance agencies do pay out claims in suicide cases. T or F?

Question

I want to know if the beneficiaries of a life insurance policy would receive a settlement if the title holder commited suicide.

Answer 1

Check your policy. I think mine wouldn't pay out if I commit suicide within two years of initiating the policy.

My policy is really funny. It will pay out $15K if I die, but will pay out $5K for each amputated limb or eye. I've told my next-of-kin that if I keel over dead, they should immediately saw off all my limbs and poke out my eyes -- $30K, or twice what they'd get if they just left the poor corpse intact.

Answer 2

The life insurance agency does not pay out the claim, the life insurance company pays the claim.

In the case of Suicide, if the policy has been in effect for two or more years (in most states, One Year in Colorado) then the life insurance company would pay the claim if the insured person died as a result of Suicide.

Review the section in your life insurance policy called "Suicide Clause" - It is a limitation in all life insurance policies to the effect that no death payment will be made if the insured commits suicide within the first two years that the policy is in force.

This clause protects the company against Adverse Selection - that is, purchase of a life insurance policy in contemplation of planned death in order for a beneficiary to collect the proceeds.

Basically, the life insurance company won't pay the claim due to suicide if the suicide occurs within two years (One Year in Colorado) of buying the life insurance policy.

I hope that helps! Best of luck to you.

Answer 3

Agencies pay nothing. The COMPANIES pay.

Yes, most policies will pay out in the case of a suicide, if the policy has been in force long enough. That period usually varies by state, between 2 - 3 years.

Answer 4

Most policies will pay out for suicide after the policy is in force for two years.

You should read the policy or call the insurance company to be sure.

But generally, the answer is yes - after two years.

And Emu...you made me LOL. But just so you know, generally you have to be alive to collect under the dismemberment endorsement of a policy.

Answer 5

Quite possibly a payout would occur, but not if the deceased had taken out the policy fairly recently. Many life insurers have a two year or more exclusion on payout from suicide caused deaths.

Answer 6

The deal is this. Most companies have the first two years of the policy where if in case of a suicide they won't pay. "Rights of Recission". After the two years they will pay for a suicide.

Answer 7

TRUE>
Most policies have a 2 year non pay period for suicides. After that, most will pay.

Answer 8

I even have never considered a existence coverage coverage that would not exclude suicide as a explanation for payout. the reason being easy sufficient: if human beings believed that their suicide might earnings their families, they may be inspired to commit suicide as a sacrifice to the kin.

Answer 9

No. Not based on most policies.