Twenty-five months after a life insurance policy had been issued, the insured committed suicide. Upon investigation, the insurance company discovered that the insured had been living with an undiagnosed Major Depressive Disorder for the past year before the suicide. Under the Diagnostic and Statistical Manual of Mental Disorders Fifth Edition (DSM-5), a guidebook used by many professionals to diagnose various mental health conditions, Major Depressive Disorder is recognized as a mental disorder. Would the beneficiaries of the insured’s life insurance policy still be entitled to receive its proceeds? Explain briefly.
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Yes, the beneficiaries are entitled to receive the proceeds of the life insurance policy. Under Section 183 of the Insurance Code (R.A. No. 10607), the insurer in a life insurance contract is liable in case of suicide committed after
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Quick check
Under Section 183 of the Insurance Code, when is an insurer liable for suicide committed by the insured?
Under Section 183 of the Insurance Code, the insurer is liable for suicide committed after two years from policy issuance or reinstatement.
What is the legal effect if an insured commits suicide while in a state of insanity?
Suicide committed in a state of insanity is compensable regardless of the date of its commission.
How does Major Depressive Disorder affect the compensability of a suicide under a life insurance policy?
Major Depressive Disorder is a recognized mental disorder that establishes a state of insanity under insurance law.
If an insured commits suicide twenty-five months after policy issuance, are the beneficiaries entitled to proceeds?
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Which statute contains the provisions governing suicide compensability in life insurance contracts in the Philippines?
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1. Two-Year Suicide Period
Under Section 183 of the Insurance Code of the Philippines (Republic Act Number 10607), the insurer in a life insurance contract is liable in case of suicide committed after the policy has been in force for a period of two years from the date of issue or last reinstatement, unless the policy provides a shorter period. Once the two-year period has elapsed, suicide becomes a compensable risk under the life insurance policy, and the insurer cannot deny payment of the policy proceeds to the designated beneficiaries based on the insured's self-destruction.
2. Suicide During Insanity
Under Section 183 of Republic Act Number 10607, suicide committed in a state of insanity is compensable regardless of the date of its commission. Where the insured suffers from a recognized mental health disorder, such as Major Depressive Disorder, that impairs volition and mental capacity at the time of self-destruction, the act is legally characterized as committed during insanity. Consequently, the insurer remains fully liable to pay the life insurance proceeds even if the suicide occurred prior to the expiration of the two-year statutory period.
3. Incontestability and Exclusions
Under the Insurance Code, after a life insurance policy has been in force for two years during the lifetime of the insured, the insurer cannot rescind or contest the policy on grounds of misrepresentation or concealment. Furthermore, unless suicide is explicitly listed as an excepted risk in the insurance contract, the statutory rules under Section 183 govern. Once the statutory conditions are satisfied, the beneficiaries acquire an absolute legal right to collect the full policy proceeds from the insurance company.