State RegulationsTN specificDifficulty 2/5
A Tennessee life policy was issued 3 years ago. The insured, who was sane, dies by suicide. What is the outcome?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
T.C.A. § 56-7-2308(5)(A)(i) confines the suicide exclusion to deaths by suicide, sane or insane, within 2 years from issue. Because this death occurred after that 2-year window, the exclusion cannot be applied and the insurer must pay the death benefit; the mental state of the insured is irrelevant once the window closes. The premium-refund exposure exists only for claims inside the window.
Why the other options are wrong
- A) Suicide is not permanently excluded; the exclusion applies only during the first 2 years under T.C.A. § 56-7-2308.
- B) A premium refund is the exposure within the exclusion window, but here the window has closed, so the full benefit is payable instead.
- D) Suicide after the exclusion window is not an application misrepresentation, and the incontestable period of T.C.A. § 56-7-2307(3) has also run.
Memory hook
Sane or insane, 2 years is the line — cross it and the policy pays.