All life insurance policies contain certain exclusions. This means there are certain circumstances in which they won’t pay out any benefits when the insured passes away. Some of these exclusions are activities that are the insured’s fault. For example, if a death occurs as a result of illegal activity, most policies won’t pay out any benefits. However, some of the other exclusions are completely out of the control of the insured, such as acts of war whether in Afghanistan or Iraq.
War Exclusion Clause and Life Insurance Claim
Most life insurance policies have an exclusion for acts of war. This means that in the event of certain war acts, such as an invasion, an act of terrorism, or a military coup, the insurance company won’t pay out any benefits to the beneficiaries of the insured. The war exclusion used to only appear only in policies of those contractually assuming liability, such as service members, rather than private citizens. The assumption was that only people in the military would die from events that were war or terror related. However, that all changed after September 11th, 2001. After the terrorist attack on the twin towers, life insurance companies began putting the war exclusion into all of their policies. If your life insurance claim was denied, contact us today.
Why Do Life Insurance Policies Have An Act Of War Exclusion?
The answer to this question is the same answer to almost every other question about why a life insurance company would refuse to pay out benefits – money. If there were a major act of war or terrorism and the beneficiaries of everyone who died as a result could claim life insurance benefits, the companies probably wouldn’t be able to afford to pay all the benefits. Most life insurance companies make their money on the premise that they’ll never actually have to pay out any money. For example, sometimes this occurs because an insured can no longer afford their policy – so they spent years paying for a policy but no one ever actually receives a payout. If a life insurance company had to pay claims as a result of war or terrorism, it would likely bankrupt them.
Most Act Of War Exclusions Are Very Comprehensive
The act of war exclusions that most life insurance companies put into their policies are quite comprehensive. It doesn’t simply include acts of war, such as a country being bombed, or a terror attack similar to September 11th. The policies generally use language that considers a broad range of actions as terrorism or war activity in an attempt to avoid making payouts.
The following is an example of an act of war exclusion in a life insurance policy:
“For the purpose of this endorsement, an act of terrorism means an act, including but not limited to the use of force or violence and/or the threat thereof, of any person or group(s) of persons, whether acting alone or on behalf of or in connection with any organization(s) or government(s), committed for political, religious, ideological or similar purposes including the intention to influence any government and/or to put the public, or any section of the public, in fear.”
As you can see, many different activities can fit into these categories, including domestic terrorism. For example, if a person kills 40 people and while he’s doing so, claims the killings were for religious or political reasons, this might give the insurance companies a legitimate reason to deny payouts.