His Family Expected $350,000. The Reinstated Policy’s Suicide Clause Meant They Received $748 in Refunded Premiums Instead.

7 min read · Last updated August 28, 2026

In this article

• The clause that isn’t contestability
• Does reinstating a lapsed policy restart the suicide clock?
• What a beneficiary actually receives
• Protect the people who’ll be filing this claim
• Frequently asked questions

Renata Colby’s husband had let a term life policy lapse two years into a rough stretch, then caught it back up eleven months later through his insurer’s reinstatement process. He kept paying, on time, every month after that. When he died by suicide fourteen months after the reinstatement date, Renata expected the $350,000 face amount the policy had always promised. What arrived instead was a refund of $748, the total premiums paid since the policy came back into force.

Nothing about the claim was denied for lying on an application or hiding a medical condition. The policy had already passed contestability once, years earlier, and the reinstatement application hadn’t raised any new issue either. A different provision entirely, one most policyholders have never heard named, was doing the work.

The clause that isn’t contestability

Nearly every individual life insurance policy sold in the United States contains two different provisions that both run on a two-year-ish window from a starting date, and it’s easy to assume they’re the same rule wearing two names. They aren’t.

Contestability lets an insurer investigate and potentially deny a claim if the application contained a material misrepresentation, and it generally expires two years after the policy is issued. The suicide exclusion clause is different: it doesn’t require any misstatement at all. It simply excludes death by suicide from the standard death benefit for a fixed period after issue, full stop, regardless of what the application said.

New York’s insurance code states this directly, requiring every policy sold in the state to exclude coverage only for “suicide within two years from the date of issue of the policy,” according to New York Insurance Law Section 3203. Missouri and Colorado set the same kind of provision at just one year. Missouri Revised Statutes Section 376.620 allows an exclusion only for “suicide within one year from the date of the issue of such policy,” and Colorado Revised Statutes Section 10-7-109 states plainly that “the suicide of a policyholder after the first policy year” cannot be used to deny a claim at all.

Does reinstating a lapsed policy restart the suicide clock?

Yes, and this is the part that catches families off guard. When a lapsed policy is reinstated, most insurers don’t just resume coverage where it left off. Several internal clocks reset from the reinstatement date, and the industry’s own multistate policy standard treats the suicide clock and the contestability clock as two separately numbered rules that can behave differently.

The Interstate Insurance Product Regulation Commission, the body that reviews and approves policy language used across most states, spells out both provisions side by side for reinstated policies: contestability “is based only on statements in the reinstatement application,” while separately, “the suicide exclusion shall not exceed two years from the day of reinstatement,” per the Commission’s own policy standard. Two provisions, two clocks, both restarting at reinstatement, listed as distinct paragraphs precisely because they don’t always work the same way on every form.

This distinction has real teeth. In Amica Life Insurance Co. v. Wertz, the Colorado Supreme Court struck down an insurer’s attempt to enforce a 2-year suicide exclusion on a policy where the insured died more than one year but less than two years after issue, ruling the policy’s 2-year window conflicted with Colorado’s own 1-year statutory limit. The case never touched contestability or any misrepresentation question. It was entirely about which suicide-exclusion clock actually applied.

What a beneficiary actually receives

A death inside the exclusion window is not treated as $0. Every state and industry standard fetched for this article requires a minimum refund of premiums paid, not a denial of everything. The Commission’s standard sets the floor at “a refund of all premiums paid, less dividends paid, any indebtedness and any partial withdrawals.” New York’s statute matches this closely, requiring “the amount of the gross premiums charged on the policy less dividends paid… and less any indebtedness,” and Missouri requires the insurer to “promptly refund all premiums paid for the excluded or restricted coverage.”

State	Exclusion period	What controls the length
New York	2 years from issue (or reinstatement, per the industry standard)	NY Insurance Law Section 3203
Missouri	1 year from issue	RSMo Section 376.620
Colorado	1 year (after the first policy year, no exclusion at all)	C.R.S. Section 10-7-109
Multistate industry standard (most other states)	2 years from issue, restarting at reinstatement	Interstate Insurance Product Regulation Commission policy standard

That refund is real money, but it is nowhere close to a death benefit. On Renata’s husband’s policy, $748 in refunded premiums against a $350,000 face amount is a difference of $349,252, a gap that exists entirely because of a fourteen-month gap between reinstatement and death, not because of anything false on any application, ever.

Protect the people who’ll be filing this claim

If your policy has ever lapsed and been reinstated, find the reinstatement date on your policy documents and count forward from it, not from the original issue date. Ask your insurer directly, in writing, when your suicide exclusion period actually ends under the reinstated terms, since it may not match whatever date you assumed applied. If you’re the one who would be filing this claim someday, keep that reinstatement letter somewhere your family can find it, alongside the policy itself.

If you or someone you know is struggling, the 988 Suicide & Crisis Lifeline is available by call or text, 24 hours a day, at 988.

Frequently asked questions

Is the suicide exclusion clause the same as the contestability period? No. Contestability lets an insurer investigate a claim for misrepresentation on the application and generally lasts two years from issue. The suicide exclusion clause requires no misrepresentation at all. It simply excludes death by suicide from the full benefit for a set period, and the two provisions can run on different timelines, especially after a reinstatement.

Does reinstating a lapsed life insurance policy restart the suicide exclusion period? In most states, yes. The industry’s own multistate policy standard states the suicide exclusion “shall not exceed two years from the day of reinstatement,” treating it as its own restarting clock, separate from the reinstatement contestability period.

What does a life insurance company pay if death occurs during the suicide exclusion period? Nearly every state requires a minimum refund of premiums paid on the policy, less any dividends or outstanding loans, rather than a full denial. That refund is real, but it is typically a small fraction of the face amount the policy would otherwise have paid.

How long is the suicide exclusion period in my state? It varies. New York and most states following the industry’s standard policy language use two years. Missouri and Colorado require only one year, and Colorado bars the exclusion entirely after the first policy year. Confirm the exact rule with your own state’s department of insurance or your policy’s actual language.

Should I let a life insurance policy lapse and reinstate it later, or buy a new one? That depends on your health, your original policy’s rate class, and how long the lapse has been. What this article’s mechanic means for that decision is that reinstating does not simply pick up where the policy left off; ask your insurer to confirm, in writing, exactly which provisions restart on reinstatement before you decide.