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Life Insurance and the Suicide Clause

Author: Danny Aaron

There are many seemingly tragic murder stories that are soon discovered to be suicides. But why would someone do that to their family? Lead them to believe that they have been murdered, only to have them discover that they did indeed take their own life. As a matter of fact, the people who do this are usually keeping their family's best interests at heart! This is because; there is a suicide clause in most life insurance policies that state that they will only pay out for a suicide death after a certain number of years of the policy being active. Even then, they may only have to pay out the amount of premiums paid by the deceased, rather than the full lump sum that was specified by other causes of death.

If the deceased sets the death up to look like a murder, they will have the peace of mind in knowing that their beneficiaries will still receive the payout. This is what a lot of people have been found out about. The life insurance companies usually investigate and determine the actual cause of death before they payout. There are certain indicating factors that determine whether the deceased would have had a motive for suicide or not. The time the policy was taken out can be a great indicator! If someone is suddenly murdered only a few months after they have taken out a policy, then it raises suicide suspicions. If it is found out that the person actually committed suicide, and framed it as murder, then they will not pay out the money to the beneficiaries.

The reason for the suicide clause in most life insurance policies is that they do not want to lose money by people who want to take their life, but also want their families to receive the financial benefit. They know that the possibility of someone who is suicidal, taking out a policy only to shortly kill themselves whilst framing it as murder could be really high. This is why they usually stipulate that a suicidal death is only coverable after the policy has been active for two years and more. It seems illogical that someone would take out a life insurance policy and then wait two years to kill themselves!

A lot of people turn to suicide in desperate times. It is one of the leading causes of death! If a parent becomes bankrupt, and unable to feed their children, then they may turn to suicide as the only light at the end of the tunnel. They know that their children and family will be financially secure once they have passed away. The life insurance companies will investigate the deceased's mannerisms and personality changes in the months leading up to their death. They will talk to family members, close friends and colleagues, and try and find any indication that the deceased would have been inclined to commit suicide. A life insurance company will be most suspicious if the deceased dies shortly after taking out a new policy. They will investigate the death in depth to ensure that it was indeed an accidental death or murder, rather than a suicide.

Naturally, suicide is a sad and even selfish thing to do. Even if the intention is to financially secure the beneficiaries, no amount of money will return their loved one to them. The worst part is that if the deceased is found to have committed suicide, it may all be for nothing, as the insurance company may not even pay out. This all depends on the suicide clause in the policy.

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