Suicide – New York

One of the most painful events a family can endure is the suicide of a loved one. This tragedy can be compounded when a life insurance company denies paying the death benefit based on a suicide exclusion in the policy. Even if a life insurance claim is denied because the insured committed suicide, it may be possible to recover the death benefit.

What is a suicide exclusion in a New York life insurance policy?

A suicide exclusion is one that allows the life insurance to avoid payment of a death benefit when an insured commits suicide. A New York life insurance suicide exclusion is only in effect for the first two years of the policy. If an insured commits suicide more than two years after the policy was issued, the death benefit must be paid.

The intent of life insurance suicide exclusions is obviously to prevent people who wish to end their lives from purchasing insurance to provide a windfall for their families. This makes sense in that it is not good in a society for people to have incentives to commit suicide. It brings to mind the film, It’s a Wonderful Life, when Mr. Potter chillingly told George Bailey after seeing his life insurance policy that “You’re worth more dead than alive!”

Are there exceptions to the suicide exclusion in New York?

Yes. Simply because the life insurance company denies payment of a claim because the insured committed suicide does not mean that an aggrieved beneficiary is left without options.

There are instances where it is evident that the insured was suffering from a serious depression or mental illness and had no intent to defraud the insurance company. In such cases, it may be possible to recover the death benefit because the insured’s mental state was seriously compromised.

That is, even if the insured committed suicide, the insurance company may still have to pay if the insured was insane at the time of the act—in other words, if the insured committed suicide due to an irresistible impulse or did not understand that the act would cause his or her death or appreciate its deadly consequences.

Did the insured consciously take his or her own life?

There also may be a question of whether the insured did, in fact, commit suicide. If the insured did not intentionally kill him or herself, the death benefit should be payable. Sometimes people die in situations where it is not conclusive that they committed suicide. If the insurance company cannot show that it is more likely the death was caused by suicide, as opposed to being accidental, it will have to pay the death benefit. Generally, the burden of proof is on the insurer because the law contains a presumption against suicide.

These cases may be further complicated depending on what type of life insurance policy is at stake: for instance, if it is part of a group plan or purchased independently from an agent or broker, different laws may apply.

The Law Offices of Eric Dinnocenzo has handled a number of New York life insurance suicide exclusion cases. You can contact us at (212) 933-1675 for a free consultation.