Term Life Insurance & Causes of Death
January 3, 2009 |
Featured, Term Life
There are several important reasons to purchase life insurance. However, the most important reason why people invest in a life insurance policy is to ensure that their dependents and loved ones will be provided for at a time of loss. No one wants to think about their untimely death, however this issue will need to be faced when you are considering purchasing term life insurance.
Term life insurance policies often have provisions to cover deaths that are not due to natural causes or medical complications. If you are considering a term life insurance policy, you need to be aware of what these provisions and situations are that could prevent your beneficiaries from collecting the death benefits on your life insurance policy. You should also consider riders to your policy that can provide additional protection.
Suicide is a horrible tragedy for any family to have to endure. At such a difficult time, grieving families may need assistance from a life insurance policy. One provision that many insurance companies include in insurance contracts is suicide clauses. What the rider usually states is that the insurance plan needs to have been active for a minimum of two years before the date of the insured’s death in order for the beneficiaries to be able to collect on the death benefit. If the time requirement has not been met then the policy will be voided and usually the money will be forfeited.
Another provision in which insurance companies often reserve the right to not pay claims is in circumstances regarding foul play. If the insured’s death is suspicious, the insurance company will withhold claims until the death has been investigated. Unfortunately people have been murdered in order to collect on insurance policies. If there is any suspicion that a beneficiary may have played a part in the policy holder’s death, their benefits will be denied.
Insurance companies rely on evidence presented by government and police investigations as well as their own research to make decisions on the insurance claims. Some insurance contracts even give insurers the right to deny claims of a beneficiary even in cases where they have not been charged with a crime.
A majority of term life insurance contracts will cover many types of accidental death, but will still have additional accident riders. Some of these clauses will enable the beneficiary to receive additional benefits if the insured’s death was caused by an accident. This will increase premium costs but will be less than increasing benefits on other causes of death.
The insurance company is who determines whether the cause of death is accidental or not. Reasons for denying accidental death claims should be specified in the insurance contract within the rider or be thoroughly explained by the insurance agent.
Many times dismemberment and accident death can be purchased either through work or privately. These additional policies can work hand in hand with a term life insurance policy to provide additional benefits for policy holder’s that work in dangerous conditions or lines of work.
Fortunately most of these types of circumstances do not occur very often. Buying a term life insurance policy is a very effective way to help protect dependents and other loved ones. You only need to be aware of these other circumstances and spend a small amount of time to ensure that you have adequate coverage in the face of unforeseen consequences. You want to spend most of your time ensuring that your dependents and loved ones are well cared for.
Tags: causes of death, suicide & life insurance, Term Life
