Life insurance and bad deeds

[picunurse]

A few days ago, there was a news story about a guy with cancer who got into a cab with a gun, asking to be taken to multiple places to buy ammo. Apparently, he never actually threatened to use either.
The cabby got scared, ditched the cab and called police, who ultimately shot cancer guy.

My question is, if he had life insurance, would it pay off? What about someone accidently killed during the commission of a crime? (Like, falling down a chimney.)

[colonial]

@picunurse

A few days ago, there was a news story about a guy with cancer who got into a cab with a gun, asking to be taken to multiple places to buy ammo. Apparently, he never actually threatened to use either.
The cabby got scared, ditched the cab and called police, who ultimately shot cancer guy.

My question is, if he had life insurance, would it pay off? What about someone accidently killed during the commission of a crime? (Like, falling down a chimney.)

I don’t know about standad US insurance contracts, but Lloyds has criminal behavior coverage exclusions.

I sued to void the life insurance claim of NHL goalie Pelle Linbergh, who was killed in an accident driving
with a blood-alcohol level of 0.24%- over twice the legal limit.

[Markxxx]

Life insurance despite it’s bad reputation will pay off if they feel there has been no fraud involved. However often in cases of suicide or criminal actions the beneficiary is going to have to go to court to force the company to pay out.

I like to read the Crime Library, you wouldn’t believe the number of morons who get away with killing only to get caught by suing an insurance company for the life insurance.

[md2000]

Most life insurance policies have an exclusion for suicide. (I was surprised to find my group life insurance at a former employer did not - just a waiting period before that coverage kicked in - presumably since you could not choose to participate or not, so it was not a case that you joined while planning suicide.)

Basically, the insurance company has to weigh the “preponderance of evidence”. If the beneficiary sues for payment, they do not have to prove beyond a reasonable doubt that the person committed suicide. They just have to persuade a judge or jury that their interpretation is the more likely one. That’s I assume the criteria they use to decide how to settle.

In the ammo case, it depends how the guy acted when confronted by police; did he point a gun at them, knowing it would cause him to get shot? (Suicide by cop) Did the police misinterpret a gesture of his? On such fine details are payments made or not; if the beneficiaries don’t like the answer from the insurance company they can take it to court.

I would like to see the wording or any criminal acts clause; after all, so many things can be made a crime. You were hit by the car because you were jaywalking. You were criminally negligent if you went into your swimming pool drunk, or fell asleep smoking, or forgot to check the tanks properly while scuba diving. OTOH, some specific acts are excluded - i.e sometimes hang gliding, parachuting, and flying experimental aircraft, as well as the result of acts of war, are excluded. (Have they added “acts of terrorism” since 9/11?)

[colonial]

@md2000

Most life insurance policies have an exclusion for suicide. (I was surprised to find my group life insurance at a former employer did not - just a waiting period before that coverage kicked in - presumably since you could not choose to participate or not, so it was not a case that you joined while planning suicide.)

Basically, the insurance company has to weigh the “preponderance of evidence”. If the beneficiary sues for payment, they do not have to prove beyond a reasonable doubt that the person committed suicide. They just have to persuade a judge or jury that their interpretation is the more likely one. That’s I assume the criteria they use to decide how to settle.

Where are you getting your information from?

According to none other than Cecil:

Cecil on Life Insurance

(emphasis added);

After much litigation, the suicide exclusion has now been limited in most cases to two years, research having indicated that such a period is long enough to weed out those who buy life insurance with the specific intention of killing themselves thereafter.

So: if someone does himself in more than two years after his life policy took effect, the insurer typically will pay. If the death takes place within two years of the start date, though, and the insurance company can prove it’s suicide, not an accident - it’s their exclusion, so the burden’s on them - they’ll usually return any premiums that were paid, but that’s it.

@md2000

In the ammo case, it depends how the guy acted when confronted by police; did he point a gun at them, knowing it would cause him to get shot? (Suicide by cop) Did the police misinterpret a gesture of his? On such fine details are payments made or not; if the beneficiaries don’t like the answer from the insurance company they can take it to court.

Cecil again:

(emphasis added):

Nowadays, however, most large insurers will cover any death after the two-year suicide exclusion is up (assuming the policy isn’t specifically limited to accidental death), so as long as the beneficiary doesn’t aid in the crime, the insurance company will likely pay out.

Anyone who antagonizes the police to the extent of getting shot by them
is likely to to taken as having caused his own death during the commission
of a felony.

I would like to see the wording or any criminal acts clause; after all, so many things can be made a crime. You were hit by the car because you were jaywalking. You were criminally negligent if you went into your swimming pool drunk, or fell asleep smoking, or forgot to check the tanks properly while scuba diving. OTOH, some specific acts are excluded - i.e sometimes hang gliding, parachuting, and flying experimental aircraft,

Again, where are you getting your information from. Mere negligence
is certainly not excludable, and the impression i get from Cecil’s column
is that a crime must be a felony to be excludable.

as well as the result of acts of war, are excluded. (Have they added “acts of terrorism” since 9/11?)

I have heard of war exclusions, but not terrorism exclusions.

[Really_Not_All_That_Bright]

@md2000

Most life insurance policies have an exclusion for suicide. (I was surprised to find my group life insurance at a former employer did not - just a waiting period before that coverage kicked in - presumably since you could not choose to participate or not, so it was not a case that you joined while planning suicide.)

As colonial (and Cecil) points out, 37 states restrict life insurance policies to 2 year (or shorter) exclusion periods for suicide. For example, §627.455, Florida Statutes:

Incontestability.—Every insurance contract shall provide that the policy shall be incontestable after it has been in force during the lifetime of the insured for a period of 2 years from its date of issue except for nonpayment of premiums and except, at the option of the insurer, as to provisions relative to benefits in event of disability and as to provisions which grant additional insurance specifically against death by accident or accidental means.

[picunurse]

colonial, thanks for the link to Cecil. That answered some of my questions.

In the news story, they didn’t really say if he pointed the gun at them, or if he even said anything. What made me wonder, is they interviewed his two daughters shortly after it happened. They were crying hysterically, saying he’d never done anything wrong in his life. I felt sorry for them and started thinking about their future.