Arizona Life and Health Practice Exam

What is typically excluded from coverage in most life insurance policies?

1. Accidental death.

2. Suicide within a specified period.

3. Death resulting from illness.

4. Natural causes.

The correct answer is: Suicide within a specified period.

Many life insurance policies commonly have exclusions, and one notable exclusion is suicide within a specified period, often within the first two years of the policy. Insurers include this exclusion to mitigate the risk of individuals purchasing life insurance with the intention of committing suicide shortly after the policy begins. This clause serves to ensure that policies are not exploited and allows insurers to maintain financial viability. In contrast, accidental death is generally covered, as the purpose of life insurance is to provide a benefit to the beneficiary in such unforeseen circumstances. Death resulting from illness and natural causes usually fall within the scope of coverage as well, as most life insurance policies are designed to provide protection against the common risks associated with death. Thus, the exclusion of suicide within a specified period stands out as a standard practice among insurers.