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Life insurance policies are not always void in suicides

On Behalf of | Aug 3, 2018 | Insurance

Each year, thousands of people across the country take their own lives, and some of them more than likely resided here in Oklahoma. The family members left behind after these tragedies often find themselves in dire financial straits if the individual had provided support for them.

The life insurance industry made a point to make people think that companies would not pay out a policy if an individual committed suicide, in order to discourage individuals from attempting to provide for their families in this manner. However, that may not be the case. Grieving family members may still be able to obtain much-needed funds in the aftermath of the loss of a loved one by suicide.

Life insurance policies and suicide

It’s a difficult subject for most people to talk about, but addressing it is necessary. Most life insurance companies will not pay out on policies in which the owner committed suicide within two years of purchasing the policy. During those first two years, the policy is subject to an incontestability clause that allows the insurance company to contest paying out a claim for certain reasons, including suicide.

Some policies also have a separate suicide clause in them that allows the company to deny a claim made when the owner of the policy takes his or her own life regardless of how old the policy is. The more general incontestability clause expires at the two-year anniversary and allows claim denials for a number of reasons. The suicide clause allows a denial at any point in the life of the policy if your family member committed suicide. These clauses may expire as well.

In order to know whether a payout from a life insurance policy is possible after a suicide, you will need to read it carefully. If you believe the insurance company should have paid out on a policy despite the cause of death being suicide, and the company denies the claim, you may want to obtain more information about the specific policy. It’s possible that the company simply counted on you not understanding the policy or was an oversight on the part of the adjuster.

Appeal the denial of the claim

You may be able to appeal a denial. It may be a good idea to enlist some assistance and guidance as you challenge the life insurance company’s decision. After all, the company will have attorneys on its side, attempting to avoid paying you the funds your deceased loved one would have wanted you to have.