Suicide Clause
If the insured dies by suicide within two years of policy issue, the insurer refunds premiums paid instead of paying the death benefit; after two years, suicide is covered like any other death.
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Practice This Concept
What is the defining purpose of a life insurance policy?
To pay a specified benefit upon the death of the insured — Life insurance is fundamentally a contract to pay a stated death benefit when the insured dies, providing financial protection to those who depend on the insured's income or services. The insuring clause states the company's promise, which is conditioned on the insured dying while the policy is in force, subject to provisions such as the contestable period and the suicide clause. Life insurance does not cover disability income, retirement medical costs, or investment performance; those needs are served by disability income coverage, health and long-term care products, and separate investment vehicles, each with its own contract terms.
National insurance concept
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