How do Life Insurance Companies Handle Death With Dignity Cases?

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Tim is a licensed life insurance agent with 23 years of experience helping people protect their families and businesses with term life insurance. He writes and creates stuff for QuickQuote and other insurance and financial websites...

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UPDATED: Mar 26, 2020

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When terminally ill Brittany Maynard ended her life (as legally allowed by Oregon’s Death With Dignity Act) on November 1, 2014, her decision touched many of us emotionally and spiritually. It also challenged us to contemplate our definitions of strength, courage, and rationality.

Currently, only three states (Oregon, Washington, and Vermont) have death with dignity laws in effect, but since 2013, seven other states have introduced bills supporting legalization of physician-assisted death for people who are terminally ill. Pennsylvania, my home state, is one of them.*

While the number of cases will likely remain few, I think it’s reasonable to predict we’ll hear of more people exercising their right to death with dignity as more states consider and pass laws allowing it.

Personally, I’d overstep my bounds to tell anyone what she should or shouldn’t do when confronted with a debilitating and—without question—fatal condition. I can only imagine the many factors that weigh into making a decision so significant—and final. But if ever I faced a similar choice, I know the effects on the loved ones I’d be leaving behind would be my primary concern.

That realization and my affiliation with this blog rather naturally brought me to wonder how life insurance companies handle situations when death doesn’t occur in its own time, but rather as a result of a voluntary, planned event.

Life Insurance Policies and Death With Dignity

You might be surprised that life insurance policies (unlike most medical insurance policies that won’t cover costs associated with self-inflicted harm) issue a benefit to beneficiaries even when the insured has taken her own life. Whether the policy owner committed suicide or had a physician-assisted death wouldn’t affect the policy’s payout, provided the policy was in place for at least two years.

With both permanent life and term life insurance, the first two years of coverage are known as a “contestability” or “exclusionary” period. If you die within that period, the life insurance company will investigate your death to make sure you hadn’t committed fraud by providing inaccurate or incomplete information on your insurance application (like hiding a terminal diagnosis, severe depression, smoking, etc.).

Life insurance applications are very thorough, gathering many details about your current health, medical history, and lifestyle so insurance underwriters can assess the risk in issuing you a policy. If evidence shows you’ve misled the insurance company, it might withhold some of the benefit payment to your beneficiary or completely deny the claim. In most cases, companies will deny a claim if the insured person commits suicide during the contestability period. That would presumably hold true for physician-assisted death as well.

Note that not all companies nor policies are exactly alike, so you should read through your policy carefully and ask your life insurance professional for clarity on anything within it that you don’t understand.

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Peace of Mind Regardless of the Circumstances

While death with dignity adds another dimension to how we react to our mortality, it doesn’t alter the needs of our loved ones to cope emotionally and financially with the loss when we pass away. Have you been proactive in researching life insurance options (term life, for example) to protect your family’s financial well-being?

*Death With Dignity National Center. Death With Dignity Around The U.S. http://www.deathwithdignity.org/advocates/national. Accessed 11.24.2014

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