Life Insurance and the Suicide Clause

Each life insurance policy has different provisions, but one common provision that can be found in almost all life insurance policies is the suicide provision.

The suicide provision states that if a person covered under a life insurance policy dies as a result of suicide within two years from the policy issue date, then the beneficiary would only be entitled to a return-of-premium, as the policy becomes null and void.

After the two-year suicide provision, the policy would pay out if the insured were to die as a result of suicide. However, it should be noted that there may be additional clauses within the life insurance contract that must be verified. The policy owner should verify the suicide provision and any policy exclusions as they may differ from company to company

Applicants who have a history of depression or other mental nervous disorders will not have a different suicide provision but they may be rated or declined when applying for insurance in the first place.  When underwriting depression or other disorders the insurance company will look for stability, hospital stays, medications,  other realted illnesses.  All these factors come into play when the underwriter analyzes the risk and accesses the insured’s ability to obtain coverage.

Insurance may also put on a non suicide exclusion such as a travel exclusion for applicants deemed to pose a higher risk due to past or future travel plans.   This exlusion is generally not built into the base policy is different than the suicide exclusion.

For more details on life insurance policies in Canada and potential exclusions, please contact us at 1-866-899-4849.

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  • Anonymous
    January 22, 2015 at 12:31 pm

    Some years ago, about eight I think, in the small town where I lived in Alberta; a man shot his wife then himself in a dispute ovet a resturaunt. They both had policies. The irony is the wifes policy didn’t pay out as it was a murder, but the murderers policy paid out as soon as the coroner ruled it a suicide. This was explained to me by the broker who handled their policies eho I knew and who also handles our families policies.

    • syed
      January 22, 2015 at 3:51 pm


      Thanks for the comment. That is indeed a strange decision by the life insurance company to reject the claim made on the murder victim’s life. If the beneficiary of her policy was the husband, the death benefit should have been paid to the next beneficiary in line or the insured’s estate if there were no other beneficiaries.

  • Brad
    January 19, 2015 at 7:50 pm

    To be perfectly honest, I can see a situation where someone would take advantage of this policy in a despdesperate attempt to save their family and loved ones from losing everything they have.

    My parents are about to lose everything they have because my mother is disabled and unable to work, and my father recently was diagnosed with stage 4 cancer after a work accident that left him permanently disabled as well. Worker’s Compensation is going to cut him off come February. Mom being on disability provides a laughable amount of money. They are about to lose their home of 30 years because they can’t afford to live anymore. Even if they downgrade to an apartment they will forever be in debt.

    I live with them and try and make as much money as I can, but it’s hardly enough to survive on. I would gladly take my own life if it meant I could pull my parents out of this financial nightmare.

    But nope, I’m turned down because of Chron’s disease and both mom and dad were turned down years ago. The system is a failure. The game is rigged. Thanks a bunch.

    • LSM Insurance
      January 20, 2015 at 10:17 am

      Brad, Really to sorry to hear about things. I hope your families situation improves

  • Terry
    May 25, 2013 at 3:10 pm

    I say no way a policy pays out if the person dies by suidide this sounds like a scam. When has this ever happened – cite an example

    • LSM Insurance
      May 25, 2013 at 4:40 pm

      Hi Terry,

      This type information would not be public. But if the policy is over 2 years and the applicant was truthful in the initial application the plan would pay out.