Does Life Insurance Cover Natural Death?
A life insurance policy provides a financial safety net for your beneficiaries if you pass away. The death benefit is paid out by the insurance company to your designated beneficiaries if you die due to natural causes, illness, or accident. Here is a table that summarizes the types of deaths covered under a life insurance policy:
| Type of Death | Covered? |
|---|---|
| Natural causes (e.g. heart attack, stroke, kidney failure, etc.) | Yes |
| Accidental death (e.g. motor vehicle accident, drowning, poisoning, etc.) | Yes |
| Murder (except if the beneficiary is involved in the murder) | Yes |
| Suicide (after the suicide clause period) | Yes |
| Death while participating in risky activities | Depends on policy terms |
| Death while engaging in illegal activities | No |
| No designated beneficiaries | Death benefit goes to estate |
It’s important to note that lying on your application about your health or exposure to a pandemic can result in the insurer refusing to pay out the death benefit. Additionally, if you engage in risky activities such as recreational pursuits or certain jobs, your insurer may add an exclusion to the policy or require higher premiums. And if you die during the suicide clause period or while committing a crime or illegal activity, your beneficiaries may not receive the death benefit.
Be sure to designate primary and contingent beneficiaries to receive the death benefit and read your policy’s fine print to fully understand what is covered and what is not. Life insurance can provide peace of mind and a valuable financial safety net for your loved ones in the event of your untimely death.
