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Key Exclusions Under An Endowment Policy

Published On Dec 02, 2021 10:00 AM By InsuranceDekho

A person may opt to buy life insurance and then decide to take his life by suicide. The policy stipulates that in the event of the policyholder's death, the sum promised should be paid out to the nominee. Suicide, on the other hand, isn't covered by insurance. In most life insurance policies, suicide is an exclusion. When a person dies by suicide within the first year of a policy's term, all life insurance companies refuse to pay out the sum assured.

Key Exclusions Under An Endowment Policy

Below are a few Key Exclusions under an Endowment Policy:

1. Determining Whether A Suicide Is The Cause Of Death

Whether the death was caused by suicide or not will be decided by the courts. A medical expert will attempt to determine the cause of death and issue a death certificate at first. When filing a claim, the beneficiary must present this certificate to the insurance company. The insurance company will investigate after receiving the death certificate. If the cause of death is a suicide, regardless of whether the life assured was sane or insane, the claim is denied.

2. Accidental Death Benefit Rider Exclusions

If a death occurs due to unnatural causes, the insurance company will conduct a thorough investigation before settling the claim. Each insurance company will conduct its investigation and will have a team of medical professionals on hand to look into the death claim. The sum assured is not paid in the case of Critical Illness or Accidental Death Benefit if death is caused by:

  • Consumption of alcoholic beverages or illegal drugs
  • If there is a conflict,
  • When you participate in a criminal act
  • In the event of pregnancy, labor, or any issues that may emerge as a result of it In the event of death as a result of a pre-existing sickness.

The riders that come with a life insurance policy are subject to certain exclusions. The life insurance firms offer to pay out the sum assured if the life assured dies in a tragic accident. The insurance coverage, however, will not pay out the sum assured if the fatal accident occurs while the assured is under the influence of alcohol or while participating in a vehicle race.

3. Exclusions In Case Of Death Caused By Lifestyle Diseases

When a person dies as a result of a lifestyle ailment, such as smoking too much, the insurance claim may be denied because the assured withheld information from the assurer. Smokers are more prone to develop lifestyle diseases and are placed in a higher risk category. As a result, they are subjected to higher premiums.

4. Aviation-Related Loss

Most insurance policies do not cover death in an air crash involving a private jet. The assurer may pay out the death benefit if the assured dies while traveling on a commercial airline that operates on a predetermined schedule and routes.

5. Contestability Period

This limited period, which is normally set at two years for life insurance companies in India, allows the assurer to thoroughly investigate and even deny death claims. This is the moment when the assurer examines the policy's underwriting and determines whether the applicant's information is correct, complete, and true. They can withhold the death claim payout if there is any discrepancy.


In conclusion, you must read the agreement thoroughly. In most life insurance policies, there are restrictions. It's vital to comprehend both the advantages and the limitations. Please remember that most insurance policies do not cover death caused by a terrorist attack. When selecting a plan, make absolutely sure it covers the majority of the significant risks and also has the smallest possible exclusions. The exclusions in a life insurance policy are usually outlined in great detail. Before getting insurance, inquire about exclusions. To ensure complete comprehension, you must read the fine print. If you do not follow these instructions, your claim may be refused. If you're considering purchasing a critical illness policy, the exclusions are very important.

Also read - What Is The Correct Time To Purchase An Endowment Policy?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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