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What is the Suicide/Contestability Clause?

2014 January 24

The Suicide/Contestability Clause states that if a person dies during the first two years of their life insurance policy, their beneficiary will not receive the funds of the policy, and the company will refund the premium to the insured’s estate. After an individual has had their policy for two years, this clause no longer applies.

The clause also states that, if an individual dies within the first two years of their policy, the insurance company may verify the accuracy of the information received in the application and/or underwriting process. If any information is found which would have caused the company to decline the application if it had been disclosed, the company may deny the claim and return the premium payment.

Check out more answers to frequently asked term life insurance questions.