Term Life Insurance Articles
A Suicide Clause And What It Means In Life Insurance Policies
2010-05-12
Like all types of insurance, Life Insurance Policies are available with many different options. Although the monetary amount that will be paid out to beneficiaries in case of death is chosen by the signer, there are special circumstances that can prevent this payment from happening. Life Insurance policies are liable to pay out large amounts of money in the case of death, often upwards of 100,000 U.S. dollars. However, the suicide clause, a safeguard for life insurance companies, can protect companies against large payouts when the death was self inflicted or intentional.
The suicide clause follows a few basic guidelines. First of all, if a consumer takes out a policy, and then commits suicide within two years of taking out the policy, the life insurance company does not have to pay out the life insurance amount. If a consumer dies during the initial two year period, the insurance company will investigate the death to determine if the death was intentional, self-inflicted suicide. If the insurance company determines that the death was in fact suicide, the company will return the premium payments paid during this time period to the beneficiaries of the policy holder. The insurance is not held liable to pay any other monetary amount.
If you know someone that shows signs of depression, you may wonder if they are eligible to take out a life insurance policy. The answer is yes, regardless of the risk of suicide, everyone is eligible for a life insurance policy. A life insurance company is protected by the suicide clause and will therefore insure even those who are likely to commit suicide. This being said, if you know someone that has a long history (or even a recent history) of suicidal thoughts or actions, you may find that is time to take action. Someone who is having a personal crisis and is planning on committing suicide may take out a life insurance policy without being fully aware of the suicide clause. If you know someone that has suicidal thoughts and has suddenly taken out a life insurance policy, this is often a red flag and this individual should be given the appropriate help. It is important to know that suicide with the hope to improve a family's financial situation is never the correct solution.
The suicide clause protects life insurance companies from payouts during the first two years, but after this time period the suicide clause no longer can prevent payouts and will pay the policy amount regardless of the cause of death. This is vital information anyone taking out a policy should know. This plan protects the insurance companies as well as beneficiaries.
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Like all types of insurance, Life Insurance Policies are available with many different options. Although the monetary amount that will be paid out to beneficiaries in case of death is chosen by the signer, there are special circumstances that can prevent this payment from happening. Life Insurance policies are liable to pay out large amounts of money in the case of death, often upwards of 100,000 U.S. dollars. However, the suicide clause, a safeguard for life insurance companies, can protect companies against large payouts when the death was self inflicted or intentional.
The suicide clause follows a few basic guidelines. First of all, if a consumer takes out a policy, and then commits suicide within two years of taking out the policy, the life insurance company does not have to pay out the life insurance amount. If a consumer dies during the initial two year period, the insurance company will investigate the death to determine if the death was intentional, self-inflicted suicide. If the insurance company determines that the death was in fact suicide, the company will return the premium payments paid during this time period to the beneficiaries of the policy holder. The insurance is not held liable to pay any other monetary amount.
If you know someone that shows signs of depression, you may wonder if they are eligible to take out a life insurance policy. The answer is yes, regardless of the risk of suicide, everyone is eligible for a life insurance policy. A life insurance company is protected by the suicide clause and will therefore insure even those who are likely to commit suicide. This being said, if you know someone that has a long history (or even a recent history) of suicidal thoughts or actions, you may find that is time to take action. Someone who is having a personal crisis and is planning on committing suicide may take out a life insurance policy without being fully aware of the suicide clause. If you know someone that has suicidal thoughts and has suddenly taken out a life insurance policy, this is often a red flag and this individual should be given the appropriate help. It is important to know that suicide with the hope to improve a family's financial situation is never the correct solution.
The suicide clause protects life insurance companies from payouts during the first two years, but after this time period the suicide clause no longer can prevent payouts and will pay the policy amount regardless of the cause of death. This is vital information anyone taking out a policy should know. This plan protects the insurance companies as well as beneficiaries.
