Suicide Exclusion 自殺除外責任

Purpose of the Clause 條款的目的

Life insurance covers the risk of death, but a policy can also create moral hazard. If a person who already intends to take their own life buys a large amount of cover for their family, the insurer takes on an unfair risk and other policyholders' interests suffer. This is a typical example of anti-selection.

The exclusion lasts only for a limited time because an intention to commit suicide is unlikely to persist for years. A suicide long after the policy began is hard to treat as planned when the policy was bought, and paying the death benefit then protects the family who rely on the policy.

Typical Terms 常見條款內容

The exclusion period is usually one year, although some policies specify two years, so the actual period depends on the policy wording. The clause normally applies to suicide "whether sane or insane", which avoids disputes at claim stage about the deceased's state of mind.

If the life insured dies by suicide within the period, the insurer does not pay the sum assured but normally refunds the premiums paid, without interest and less any policy indebtedness, such as an outstanding policy loan. The policy is not void from the beginning; the insurer's liability is simply limited. A beneficiary's rights are also subject to this clause.

If the suicide occurs after the period has ended, the insurer normally pays the death benefit in full under the policy terms, less any policy indebtedness.

When the Period Starts 除外期的起計日

The period generally runs from the date the policy is issued. If a lapsed policy is reinstated, the period usually starts again from the reinstatement date, because anti-selection can also arise then: someone already contemplating suicide may revive a policy to regain cover.

Some policies also provide that if the sum assured is later increased with underwriting, the increase has its own exclusion period running from its effective date, while the original sum assured is unaffected. The exact arrangement depends on the individual policy wording.

How It Differs from Other Provisions 與其他條款的分別

The incontestability provision restricts an insurer, after a set period, from challenging the validity of the policy on grounds such as non-disclosure or misrepresentation. The suicide exclusion instead deals with one cause of death and limits the amount payable. They do different jobs and each must be applied on its own terms.

An accidental death benefit rider normally excludes suicide and intentional self-inflicted injury with no time limit. So if the life insured dies by suicide after the basic policy's exclusion period has ended, the basic policy pays, but the accidental death benefit is normally still not payable.

An insurer relying on this clause to refuse the sum assured generally has to prove that the death was suicide. If the evidence falls short, for example if it shows only that the life insured fell from a height, the insurer cannot apply the exclusion on speculation alone.