An Insight into Common Exclusions in Life Insurance Policies 

An insurance contract will promise to pay out the sum assured when the premium is paid by the policyholder and an insured event occurs during the contract’s term. However, to minimize losses, the insurance companies talk about exclusions in the cover which they offer. Exclusions can be defined as events and conditions which are not covered by the insurance policy.

Read more
Get ₹1 Cr. Life Cover at just ₹411/month*
No medical checkup required
Save more with upto 10% discount
Covers COVID-19
Tax Benefit
Upto Rs. 46800
Life Cover Till Age
99 Years
8 Lakh+
Happy Customers

*Tax benefit is subject to changes in tax laws. *Standard T&C Apply

** Discount is offered by the insurance company as approved by IRDAI for the product under File & Use guidelines

Get ₹1 Cr. Life Cover at just ₹411/month*
No medical checkup required
Save more with upto 10% discount
Covers COVID-19
+91
View plans
Please wait. We Are Processing..
Get Updates on WhatsApp
By clicking on "View plans" you agree to our Privacy Policy and Terms of use

Let’s understand this with a real-life scenario. An individual may decide to purchase a life insurance policy and then suddenly choose to end his life by committing suicide. As per the policy, the nominee should be paid out the sum assured in the event of the policyholder’s death. However, a suicide, in particular, is not insured. Suicide is usually an exclusion in a life insurance policy. All life insurance companies do not pay out the sum assured when death takes place by suicide within the first year of the policy term.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

Determining Whether a Questionable Death is Suicide

The courts will make the ultimate decision whether the death is by suicide or not. Initially, a medical expert will try to determine the cause of death and issue a death certificate. The beneficiary needs to submit this certificate to the insurance company when making a claim. After receiving the death certificate, the insurance company will carry out an investigation. The claim is denied if the cause of death is suicide, irrespective of whether the life insured is sane or insane.

Exclusions in Accidental Death Benefit Rider

If death occurs under unnatural circumstances, the insurance company will investigate the case extensively before settling the claim. Each insurance company will follow its own investigation procedure and is equipped with a team of medical professionals who will investigate the death claim. In the case of Critical Illness or Accidental Death Benefit, sum assured is not paid if death is caused by:

  • Consumption of alcohol or drugs
  • In the event of war
  • When taking part in a racing activity or a hazardous activity
  • When taking part in an act which is criminal in nature
  • In case of pregnancy or childbirth or complications which arise from it
  • In case of death owing to a pre-existing illness.

Some exclusions are applicable on the riders which come with a life insurance policy. Under accident disability riders, the life insurance companies makes the promise to pay out sum assured in case the life assured loses his life in an untoward accident. But, if the fatal accident happens when the insured is under the influence of alcohol or while taking part in a car-racing event, the insurance policy will not pay out the sum assured.

Exclusions in the Event of Death Occurring from Lifestyle Diseases

In the case of death which happens due to a lifestyle disease such as excessive smoking, the insurance claim may be denied on the basis that the insured has concealed information from the insurer. Smokers are likely to succumb to lifestyle diseases and are categorized in a higher risk pool. They are, therefore, charged higher premiums.

Why Reading the Policy is Important

Hence it is important that you read the policy with a lot of care. Most life insurance plans will have certain exclusions. While it is important to know the benefits it is crucial that you also understand the exclusions. Take note of the fact that death by terrorist attacks is also not covered by most of the plans. When you make your selection, you must ensure that your plan covers most of the major risks and has minimum exclusions. Exclusions are generally clearly stated in a life insurance policy.

When you buy a policy enquire about the exclusions. For complete clarity, it is necessary that you read the fine print. If not done, you may face a claim rejection. If you are considering buying a critical illness cover, the exclusions are all the more important.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

You may also like to read : Top Reasons for Life Insurance Claim Rejection

Written By: PolicyBazaar

Life insurance articles

Recent Articles
Popular Articles
How to Cancel SBI Life Insurance Policy?

18 Nov 2021

As per the Insurance Regulatory and Development Authority, you...
Read more
Max Life Insurance 1 Crore Plan

14 Oct 2021

With many novel diseases surfacing, life seems to be fleeting...
Read more
Life Insurance for Senior Citizens Over 70

14 Oct 2021

Although you may be past the opportunity to buy life insurance...
Read more
Life Insurance for Senior Citizens over 80

14 Oct 2021

If you are the bread earner for your family, no time is bad to...
Read more
Life Insurance for Armed Forces

14 Oct 2021

The Indian arm forces are our pride. They risk their lives to...
Read more
How to Check LIC Policy Status, Details, Statement via Online/SMS/Call
Last year, Mr. Rajiv Verma bought a Child LIC policy to provide financial security for his kid's future. However...
Read more
Surrender Value in Insurance
Surrender Value in Insurance Have you bought a life insurance policy which is not as per your requirement? Are you...
Read more
LIC Login: LIC Customer Login Process at Online Portal
The LIC login portal is user-friendly. With the LIC online login facility, customers can easily avail themselves of...
Read more
How to Check PLI Status?
How to Check PLI Status? Dating back to February, 1884, PLI (Postal Life Insurance) is one of the oldest life...
Read more
Life Insurance: Checking Policy Status
Life Insurance: Checking Policy Status Buying life insurance policy is the first step towards building a corpus...
Read more
Close
Download the Policybazaar app
to manage all your insurance needs.
INSTALL