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Does Life Insurance Cover Suicidal Death?

Suicidal death is mostly excluded from an insurance policy just like many other conditions. Though suicide starts getting covered after the plan completes a year, not many know the exclusions and details of it mentioned in their policy bond. So, let’s look at suicidal death and understand the terms and conditions regarding it.

Insurance Coverage for Suicidal Death

Suicidal death gets included in the insurance coverage after your policy has completed a year since the date of purchase. But if the suicide takes place before the policy completes a year, then the claim gets rejected and no death benefit is paid out to the beneficiary. From the second year onwards, the policyholder is covered for suicidal death and the probability of the claim getting settled is high.

Exclusions for Suicidal Death

Bought Before January 1, 2014

In case of suicide within 12 months of buying the life insurance plan or from the date of revival of the policy, the claim will be rejected and no death benefit will be paid out. But if the policyholder commits suicide after one year from the date of purchase of the plan, the claim will not be rejected and the death benefit will be given to the beneficiary.

Bought After January 1, 2014

If the policyholder commits suicide within 12 months of buying the insurance plan, the beneficiary is entitled to receive at least 80 percent of the premiums if the term policy is active. If the policy was revived, then an amount greater than 80 percent of the premiums paid from the date of revival till the death of the insured will be given. Or else, the surrender value on the date of death of the policyholder will be paid.

Unit-Linked Policy

For Unit-Linked policy, on the death of the policyholder within 12 months of purchasing a life insurance plan, the claim will be rejected. The fund value of the units held by the insured will be paid to the beneficiary.

Conditions for Claim Rejections in Case of Suicide

  1. The insured provides incorrect information about themselves to the insurance company, then the claim will not be accepted
  2. In the case of revival of a lapsed policy, the claim gets rejected for suicidal death
  3. If the insured has a plan under group life insurance, the claim is likely to get rejected as suicide is not covered
  4. In case of death due to suicide within the grace period, the sum assured will be paid to the beneficiary after deducting the outstanding premiums and interest