In the event of suicide within the exclusion period, which statement is true about payout?

• A. The death benefit is paid in full
• B. The premiums paid are refunded to the beneficiary
• C. The death benefit is not paid, but premiums are refunded
• D. The policy expires with no refund

Answer: (C)

Suicide exclusion periods are built into many life insurance policies to prevent payout of the death benefit if death by suicide occurs early in the policy. During this period, the insurer typically does not pay the death benefit. Instead, they refund the premiums that have been paid to date (often subject to policy terms, such as deductions for any loans). After the exclusion period ends, the death benefit would usually be paid if death occurs. So the statement that fits is: the death benefit is not paid, but premiums are refunded.