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Written by
Carol Pope
Carol Pope is a former insurance writer for Bankrate and prior to joining the team, she spent 12 years as an auto insurance agent. During this time, she sold, serviced and underwrote auto insurance for people across the country. She also has experience selling supplement coverage such as umbrella insurance.
Edited by
Lisa McArdle
Lisa McArdle is an insurance editor who joined the Bankrate team in 2023. She has more than 15 years of experience writing, editing and managing content in a variety of industries, including insurance, auto news and pop culture.
Reviewed by
Kenneth Chavis IV
Kenneth Chavis IV is a senior wealth counselor at Versant Capital Management who provides investment management, complex wealth strategy, financial planning and tax advice to business owners, executives, medical doctors, and more.
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As you get older, having a life insurance policy in place may allow you to leave money to your loved ones if you pass away. However, not everyone knows that there are certain exclusions that might prevent your beneficiaries from claiming your death benefit. If you have a life insurance policy, it’s important to know what those exclusions are so your loved ones can avoid any surprises following your death.
A life insurance exclusion is a situation or circumstance that prevents your beneficiaries from receiving your death benefit. Essentially, it means that certain causes of death are not covered by the policy. Life insurance exclusions are regulated at the state level, but insurance companies can decide which of those exclusions they include in their policies. Exclusions will be listed in the policy at the time of application, so the insured will know which causes of death may not be covered by the policy before accepting a policy.
The main reason life insurance companies add exclusions is to protect them from risk — namely untimely deaths, which may cost the company more money in the form of an early death benefit. Exclusions are a way for insurers to reduce the likelihood of paying a death benefit in certain situations.
You might be surprised to learn what situations may not be covered by insurance. Some common life insurance exclusions include death caused by:
James Miles, consulting staff fellow for the Society of Actuaries, says virtually every life insurer typically includes the same outright exclusion in its policy: a suicide clause.
“Depending on the state, it’s usually a two-year suicide clause. If you die by suicide within the first two years of the contract, the beneficiary would receive the premiums back but not the death benefit,” he says.
The suicide clause is in place to prevent individuals from purchasing a life insurance policy when they are struggling with mental health disorders or are planning suicide. Most life insurance companies screen applicants for mental health conditions, like depression and anxiety, before they are approved for coverage. And while you will likely pay a higher premium if you are living with a mental health condition, you will still most likely be able to get a life insurance policy.
In the case of physician-assisted suicide, the same rule applies. If you live in a state where assisted suicide is legal, you must pass the two-year period before you can claim death benefits.
Some life insurance policies, known as accidental death policies, only provide coverage for the insured if they die due to an accident. Causes of death related to illness, medical issues or chronic health conditions are not covered. These policies will define what constitutes an accident and may include exclusions due to death from:
It’s also worth noting that risky hobbies, substance abuse and misrepresentation (providing false information on your application) could bar you from getting coverage in the first place or subject you to a higher premium.
Additionally, life insurance policies have a contestability period, in which life insurance companies can investigate your application and deny claims. This period is typically one to two years from the effective date of the policy. If you pass during the contestability period and the insurer determines you misrepresented yourself, or provided any false information to your life insurance company, it could completely void your coverage and no death benefits will be paid.
Knowing what your life insurance covers may be vital. After all, some types of life insurance will cover you for your entire life — which means making premium payments for your entire life, too. As such, not understanding your life insurance exclusions could prove to be a costly mistake.
One way to learn more about the exclusions on your life insurance policy is to read through your contract. Although it may be dense, your contract will spell out precisely what is and isn’t covered on your life insurance policy. However, life insurance is complex, and contracts may be hard to decipher. With that in mind, it may be a good idea to meet with your life insurance agent, so they can break it down for you.
Over the years, life insurance companies have altered their definition of risky behavior based on global, economic and socially-driven changes. For instance, some life insurance companies used to exclude private aviation from the list of covered causes of death. However, as private aircraft became safer, many life insurance companies eased up on the rules for most policyholders. Today, some life insurance companies offer an aviation rider for recreational pilots.
It’s important to note that although some circumstances and health statuses may not be exclusions on your life insurance policy, they could be risk factors that may contribute to a higher premium. Additionally, every insurance company is different, so it’s important to read through your contract to understand your policy limitations.
Life insurance exclusions are typically included in a policy automatically. Policies that include many exclusions, such as accidental death policies, may be lower cost, whereas choosing a traditional whole life policy with few to no exclusions will likely increase your premium.
People who engage in hobbies or activities deemed risky can still secure life insurance coverage. While some life insurance companies may decline extending coverage to a high-risk individual, other companies may offer a policy at a higher premium, offer a policy with an exclusion to hazardous activities or offer a rider such as Adventure Activities Coverage to enhance the policy. Activities deemed high-risk include BASE jumping and race car driving, but some professions like loggers and steel workers will also fall into the high-risk category. Speaking with your life insurance agent openly about your occupation and hobbies can help you secure the right type of life insurance for you and your family.
Life insurance exclusions are included in full policy language that you receive when you purchase a policy. Before you purchase life insurance, you can ask your agent to review all policy exclusions with you. If you have any questions about what’s covered, you may want to contact your agent who can walk you through the details of your policy.
Most insurance policies include a suicide clause that states the policy will not pay out the death benefit if the policyholder commits suicide within a certain period of time after the policy is purchased. Typically, the exclusionary period is two years, but it can vary between insurance companies. In the event of a policyholder’s suicide within the exclusionary period, the life insurance company will usually refund the premiums paid on the policy. This even applies to term life policies. However, group life insurance policies do not typically have a suicide clause.
