In the insurance contract, an insurer promised to cover damages suffered by an insured during the emergency according to the contract’s terms. However, an insurance company wants to limit their losses, by inserting some exclusions in life insurance policies. There are certain events and conditions that are not covered by an insurance policy and these are referred to as “exclusions in life insurance”. For example, An individual opts for a life insurance policy but suddenly decided to end his life by committing suicide. As per the life insurance policy, the insured should get a guaranteed sum after his death but the deaths from suicides aren’t covered under a life insurance policy.

  • Death by  Suicide 

To decide whether death occurs by suicide or not, the court will make a final decision. In an initial stage, a medical expert will examine the cause of death and accordingly issue a death certificate. This death certificate needs to submit to the insurance company to propose a claim. After receiving the death certificate, an investigation will be carried out by an insurance company. If the cause of death is suicide irrespective of the Insured is sane or insane, no claim will be given.

  •  Death by Accident

The insurance company will investigate the case properly if the death occurs under unnatural circumstances before settling a claim. Every insurance company has its own investigation procedure and has a team of medical professionals who will investigate the case.

Mentioned below are some exclusions in life insurance for critical illness or accidental deaths:

  • Consumption of alcohol or drugs
  • In the event of war
  • When taking part in a racing activity or a hazardous activity
  • When taking part in an act which is criminal in nature
  • In case of pregnancy or childbirth or complications which arise from it
  • In case of death owing to a pre-existing illness.

Under accident disability, the life insurance company has the liability to pay the assured cover/sum if the insured has lost his life in an untoward accident. But, if the accident happened under the influence of alcohol or while participating in a car-racing event,  then this will not cover under the life insurance policy.

  • Death from Lifestyle Diseases

If the insured camouflaged any material facts from the insurance company such as the habit of excessive smoking and if he dies because of it, an insurance company is eligible to reject the claim. Smokers are likely to suffer from lifestyle diseases and they are categorized under a higher risk pool. They are, therefore, charged with high premiums. The deaths which occur due to lifestyle diseases can be denied the claim, simply because the insured has concealed information from the company.

  • Read before Buying 

Read every clause of an insurance policy before buying. Every insurance policy has some exclusion. It is important to know every benefit but it is equally important to understand the exclusions. Some life insurance policy does not cover terrorist attacks. While selecting the life insurance plan, always make sure that your policy has maximum benefits and minimum exclusions. Every life insurance policy has clear information about each exclusion.

Therefore before going for an insurance policy ask about exclusions. For better clarity, it is important to go through each line and if not done properly, one may face a claim rejection.

Consider all exclusions in the life insurance policy, before buying it.

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