What if a life insurance company denies a claim for life insurance benefits based on their contention that the insured committed suicide?
A 1982, opinion from the 14th District Court of Appeals styled, Parchman v. United Liberty Life Insurance Company, correctly states that life insurance policies typically exclude suicide as an assumed risk.
In the Parchman case, the policy excluded suicide as an assumed risk for two years from the policy date and provided a reduced benefit of the return of all premiums paid if death resulted from suicide within that period.
This was the same ruling in the 1986, Amarillo Court of Appeals opinion styled, Southern Farm Bureau Life Insurance Co. v. Dettle.
In Dettle the policy provided: If the insured within two years from the date of issue of this policy shall die by his own hand or act whether sane or insane, the liability of the Company shall be limited to an amount equal to the premiums actually paid, without interest.
Also, in Dettle, the Court said that when the suicide exclusion is litigated, the court’s definition of “suicide” should include an “intentional” component. In Dettle the court commented that if the court charged in the policy language (“If the Insured … shall die by his own hand or act whether sane or insane”) and if the policy language were interpreted literally, the insurer could avoid liability even in instances of pure accidents; for example, a pure accidental death at one’s own hand would be excluded by a literal interpretation of the policy language.
In 1988, the Beaumont Court of Appeals in a case styled, Massachusetts Indemnity & Life Insurance Company v. Morrison, stated that there is a legal presumption against suicide. The presumption may be rebutted, and then the question is for the jury. Because suicide is a defense, the insurer has the burden of proof.
In Morrison, Morrison died in a one-car collision with a tree. There was evidence that Morrison was depressed, had health problems, and had trouble at work. A suicide note was found. On the other hand, there was conflicting evidence on whether the note was in Morrison’s handwriting, and there was expert testimony that it would have been extremely difficult for Morrison to intentionally drive his car into the tree. The conflicting evidence allowed the jury to find Morrison’s death did not result from suicide.