7 Death Cases Term Insurance Policies Do Not Cover
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7 Death Cases Term Insurance Policies Do Not Cover

A term insurance policy entitles the nominee to receive the entire sum assured as the death benefit. Claim reimbursements are subject to the policy terms & conditions. The insurance company can accept the claim, in case the demise of the policyholder occurs during the policy term. So, are there any term insurance exclusions that you need to know?

If you don’t know, you have been living all your life with only one-half of the policy terms. One sure thing that you need to here is the cause or nature of death also matters.

Term Insurance Exclusions in India

Today, I have come up with this very interesting topic that covers 7 death cases that are not covered by term life insurance in India. Here are some term insurance exclusions that you must know.

The policyholder was murdered

This is one such case wherein the policyholder was murdered by someone. This comes to a point where the scenario can further go into two directions.

The nominee is the culprit

In case of the murder of the policyholder, the insurance company simply withholds the payout indefinitely if the nominee was found involved in relation to the crime. Now, the payout is not possible until the case is resolved in favor of the nominee.

If the policyholder died as a result of his involvement in criminal activity

The payout remains unsettled as long as the case is active and in force. During the murder investigation, if the policyholder was found to be dead as a result of being a part of criminal activity, the insurer will deny the payout.

This is because as per the laws of IRDAI, no payout can be released to the nominee if the policyholder died as a result of his/her involvement in any sort of criminal activities, whatsoever.

This brings me to think what if a policyholder who also has a criminal record died due to a condition like dengue, heart attack, swine flu, etc? Well, the nominee will get the sum assured, after proper investigation of course.

The policyholder died under the influence of alcohol

Whenever a policyholder dies, irrespective of the cause, insurance companies certainly keep an eye on the investigation. Now, if an insurer dies due to an accident while she/she was proved to be driving under the influence of alcohol, the insurer will reject the claim with immediate effect.

While insurance companies require you to provide information on whether you drink or not. However, if you drink and don’t inform your insurer about the same, the insurer withholds the payout of the death benefit. Some people who drink too much don’t mention it in their insurance form, which leads to claim rejection in the future.

To avoid claim rejection due to this, make sure to provide the correct information wherever applicable in your insurance form.

Undisclosed habit of smoking

Like drinking, smoking is another lifestyle hazard that you need to mention in your life insurance form. If you do mention it, this will make you pay a higher amount as the premium but you will still get the insurance you seek. This additional premium is called Load on the premium.

In case the policyholder dies due to the habit of smoking and the insurance company finds it out (which it surely will), the claim of the death benefit will be rejected consequently. This highlights another factor here, which is that many people don’t read the insurance papers before they sign. I recommend reading all inclusions and exclusions (at least) without fail to avoid claim denial.

Death due to participation in hazardous activities

Term life insurance policies strictly don’t cover the death instances that occur due to participation in hazardous activities by a policyholder. Needless to say, these activities pose a great threat to the life of the insured and may lead to death at any time.

In case you work as a stuntman or participate in multiple adventure sports activities very often, you need to inform the same to your insurer before policy issuance. Now, the insurer will either deny you insurance coverage or will charge you a significantly high premium. Any miscommunication will lead to claim rejection.

Death because of a pre-existing condition

While purchasing a term life insurance, the insurer requires you to provide the details regarding your health, such as if you have a pre-existing disease of any kind. Here, you need to be honest, as this might affect your future claims.

Although some insurers require you to undergo a complete health check-up before they issue a life insurance policy to you, some just require you to provide the information in the form. Now, if any such condition that leads to or becomes the cause of your death, the death benefit claim will be rejected.

Death because of childbirth

In case the policyholder dies while giving birth to a child or because of some delivery-related complications, the insurance is not liable to release the death benefit. While this seems a bit too unfair, insurance companies are here to run their businesses and not to back you up financially in every unfortunate case.


This is the most common one among term insurance exclusions in India. If the policyholder commits suicide in the first year of the policy issuance, the insurance company can reject the claim.

However, the case can be different after the first year, as some insurance companies cover the incident valid subject to the policy terms and conditions.

Bonus Case

These are some common cases of death in which claims are rejected by insurance companies. There must be some other cases as well. One such case is when the policyholder dies due to a natural disaster. For example, an earthquake, landslide or rockslide, tsunami, etc. Insurance companies consider these cases under the act of god, which they don’t entertain. No claims arising out of such an incident are issued the death benefit.


This has been a comprehensive list of term insurance exclusions – 7 death cases insurance companies deny the claim for. I hope you knew a few of them but I bet you didn’t know them all.

Did I miss any other death case that you think should be on my term insurance exclusions list? Please share with me.

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