Paul Sanchez
Life insurance is a difficult topic to discuss at the best of times, and when it comes to suicide, it can be even more challenging. However, it is important to understand how life insurance policies handle such situations, especially as suicide is, unfortunately, a common occurrence in the UK. The good news is that most life insurance policies do cover suicide, but there are some exclusions and conditions that it's important to be aware of.
| Characteristics | Values |
|---|---|
| Does life insurance cover suicide? | Yes, but only after an initial qualifying period. |
| How long is the initial qualifying period? | Usually 12 months, but it can be up to 24 months. |
| What is a suicidal death clause? | A clause in a life insurance policy that states the terms and conditions for payment of a claim due to suicide. |
| What does a suicidal death clause do? | It relates to a time period from the start date of the policy (inception) during which a claim would not be paid in the event of suicidal death. |
| What happens after the exclusion period? | After the initial exclusion period, you’re fully covered under most life insurance policies in the UK. |
| What happens if I don't disclose my mental health history? | Non-disclosure is a main reason for a claim being declined. |
| What happens if I switch life insurance policies? | Switching life insurance policies restarts the suicide clause and contestability period, even if you purchased the new policy from the same company. |
What You'll Learn
Suicide clauses in life insurance policies
Suicide clauses, also known as suicide provisions, are a common feature of life insurance policies. These clauses typically apply for a certain period after the policy is issued, usually one to two years, but this can vary depending on the insurer and state regulations. During this exclusion period, if the policyholder dies by suicide, the insurer may deny the death benefit or only return the premiums paid. The clause is intended to protect insurance companies from financial risk by preventing individuals from taking out a policy with the intention of ending their lives soon after.
After the exclusion period ends, most life insurance policies do cover suicide, and beneficiaries would be entitled to receive the full death benefit. If a policy does not include a suicide exclusion clause, the insurance company is required to pay the full death benefit if the insured dies by suicide.
It's important to note that different types of life insurance policies may have specific clauses and conditions that impact coverage. For example, group life insurance policies, often provided as part of an employee benefits package, usually include similar suicide clauses to individual life insurance policies. On the other hand, military life insurance policies and group life insurance policies through an employer or organisation generally do not include a suicide clause, so they typically pay out for suicidal death.
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Suicide exclusions in the first two years
The suicide clause typically lasts for the first one to two years after the policy is issued. During this exclusion period, if the policyholder dies by suicide, the insurer may limit or deny the death benefit payout. Instead, they might refund the premiums paid up to that point. The exact duration of the suicide clause can vary depending on the insurer and state regulations. For example, while most states enforce a standard two-year period, some states like Missouri, Colorado, and North Dakota have shorter one-year periods.
After the exclusion period ends, most life insurance policies cover suicide, and beneficiaries are entitled to receive the full death benefit. The suicide exclusion period can be restarted if changes are made to the policy, such as adding coverage or converting a term policy into a whole life policy.
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Getting life insurance with a history of mental illness
If you have a history of mental illness, you may be concerned about getting approved for life insurance. While it is true that mental illness can affect your life insurance options, it is still possible to obtain coverage. Here are some things to keep in mind when seeking life insurance with a history of mental illness:
Be honest about your mental health
It is crucial to be honest and disclose your mental health history when applying for life insurance. Failing to disclose a mental illness on your application can be considered insurance fraud and may result in your policy being denied or cancelled. Life insurance underwriters use databases like the Medical Information Bureau (MIB) to verify your medical history, so it is essential to be truthful.
Shop around for the right insurer
Not all insurers view mental health conditions in the same way. Some insurers may be more sympathetic than others towards individuals with mental health issues. It is worth comparing different insurers and their policies to find one that suits your needs. Working with an independent broker or agent who specialises in high-risk cases can be beneficial as they can help you navigate the process and find the right coverage for your situation.
Understand the impact of mental health on life insurance rates
Mental health conditions can affect the cost of life insurance. Certain mental illnesses with an increased risk of suicide may result in higher premiums or lower coverage limits. However, seeing a mental health professional, following a treatment plan, and having a stable employment history may improve your chances of being approved for life insurance at a better rate.
Consider guaranteed issue life insurance
If you are unable to find traditional term or permanent life insurance that meets your needs, guaranteed issue life insurance may be an option. This type of coverage offers lower levels of protection (usually less than £50,000) and does not require a medical exam or health questionnaire. While it tends to be more expensive, it can be a viable option for individuals with severe mental health conditions.
Be prepared for the application process
When applying for life insurance, you will likely encounter questions about your mental health. Insurers will want to know about your diagnosis, the severity of your condition, any hospitalisations, the frequency of episodes, the impact on your daily functioning, and your treatment plan. The application process may also involve a phone interview and a medical exam, including blood and urine tests.
Understand your rights and seek support
If you are denied life insurance due to your mental health, remember that you have rights. Mental health discrimination is illegal, and there are organisations like Mind that can provide support and guidance. You can also consider contacting the Financial Conduct Authority or seeking legal advice if you believe you have been treated unfairly.
Seek help if needed
If you or someone you know is struggling with mental health issues or suicidal thoughts, know that help is available. Organisations like the National Suicide Prevention Lifeline, Crisis Text Line, and Samaritans offer confidential support and resources.
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Appealing a denied benefit
If your life insurance claim is denied, you can take steps to contest the rejection. Here is what you need to know about the process and your options.
Understanding Denial Reasons
Firstly, it's important to understand why your claim was denied. Life insurance companies deny claims due to various reasons, including:
- Policy delinquency: The policyholder failed to pay premiums on time, causing the policy to lapse.
- Material misrepresentation: The policyholder lied or omitted information on their application, such as medical history, occupation, or hobbies.
- Contestable circumstances: The death falls within a contestable timeframe (usually the first two to three years) and involves suicide, illegal acts, or other excluded causes.
- Documentation failure: The beneficiary failed to provide necessary paperwork, such as a death certificate.
Initial Steps to Take
If your claim has been denied, the insurance company is required to send you a written notice explaining the reasons for the denial. This letter should outline the specific reasons, quote relevant policy provisions, and list the documents reviewed. You have the right to request a denial letter if you were informed of the denial over the phone.
Gathering Supporting Documentation
To contest the denial, you will need to gather supporting documentation. This may include medical records, autopsy reports, insurance payment receipts, or any other evidence that can help your case. For example, if the denial was due to policy delinquency, you can provide receipts showing that premiums were paid on time.
Appealing the Decision
You have several options to appeal the denied benefit:
- Contact the insurance company directly: Call the insurance company to discuss your claim, understand their appeals process, and present any proof or supporting documentation you have gathered.
- Consult a lawyer: Consider hiring a lawyer, especially one who specialises in life insurance cases, to guide you through the appeals process and improve your chances of recovering the benefit.
- Seek free help: Contact your state department of insurance or attorney general for free assistance. This method may take longer but can add weight to your appeal.
Understanding the Appeal Process
The appeal process can vary depending on the insurer and the specific circumstances of the case. It may involve conducting a thorough investigation, gathering documentation, and filing an administrative appeal within a certain timeframe. If you work with a lawyer, they will be able to guide you through the specific steps and requirements of the appeal.
Understanding Your Rights
It's important to know your rights as a beneficiary. In some cases, insurers may wrongfully deny claims or make mistakes during the claims process. You have the right to request clarification on the denial reasons and appeal the decision if you believe it was unjustified.
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Suicide prevention and support
- National Suicide Prevention Helpline UK: This helpline offers a compassionate listening ear to those grappling with their mental well-being or thoughts of suicide. Their lines are open daily from 6 pm to midnight, providing a safe and confidential space for individuals to discuss their feelings or concerns. The helpline number is 0800 689 5652, with an alternative option at 0800 689 0880.
- Zero Suicide Alliance (ZSA): ZSA is an NHS-funded support service that provides free online training and resources to raise awareness about suicide prevention. Their website offers educational materials and guidance to help individuals and businesses understand the impact of suicide and ways to prevent it.
- Samaritans: Samaritans is a well-known UK charity that offers free 24/7 support services to individuals struggling with their mental health. They provide multiple ways to contact them, including a freephone number (116 123), email ([email protected]), and post (Freepost, SAMARITANS LETTERS).
- PAPYRUS UK: This charity focuses on suicide prevention among young people under 35 in the UK. They offer a 24/7 'HOPELINE' (0800 068 4141) and text service (07860 039 967) as well as email support ([email protected]). They also provide online guides and resources to help individuals in need.
- CALM (Campaign Against Living Miserably): CALM offers mental health support services between 5 pm and midnight, 7 days a week, for anyone over the age of 15 in the UK. They provide guidance and support around mental health and suicide through their telephone service (0800 58 58 58) and online live chat.
- Suicide & Crisis Lifeline: Individuals struggling with depression, anxiety, or suicidal thoughts can text or call 988 to connect with this lifeline. It is a free, confidential service available 24 hours a day, 7 days a week.
- Veterans Crisis Line: This crisis line is specifically for veterans, service members, and their families. They can be reached by calling 988 and pressing 1 or by sending a text to 838255. These services are also free, confidential, and available around the clock.
It's important to note that these organisations provide valuable support and resources for individuals struggling with their mental health and suicidal thoughts. If you or someone you know is in immediate danger or needs urgent assistance, it is crucial to contact emergency services by dialling 999.
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Frequently asked questions
Yes, but usually only after an initial exclusion period of 12 to 24 months.
A suicide clause, or suicide provision, is a clause in a life insurance policy that states that the insurer won't pay out to beneficiaries if the insured person dies by suicide within a certain period from the start of the policy (usually one to two years).
Switching life insurance policies restarts the suicide clause and contestability period, even if the new policy is from the same company.
If the insured person dies by suicide during the exclusion period, the beneficiaries may receive a refund of the premiums paid into the policy before the death.
If your life insurance claim is denied, you can review the insurer's denial letter, gather relevant documentation (e.g. the insured's medical records), understand your rights under state laws, and consult with an attorney or insurance professional to help you challenge the decision.
