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Exclusions: What life insurance doesn’t cover

    Imagine that you’re the only income earner in your family. How would you pay for your medical needs should you run into an accident that leaves you bedridden and out of your job? And if you pass on, how would your dependents survive when you’re no longer around to provide for them?

    These are difficult, agonizing situations where you need life insurance the most.

    How can life insurance help you or your dependents?

    Life insurance will provide a lump sum to you or your beneficiaries in the event that: 1)  you totally and permanently lose your physical ability and become unable to earn income, or 2) pass away. 

    The payout can be used for any purpose and can help you get the necessary treatment and maintain your living. Should you pass on, the lump sum will be paid out to your dependents (or other named beneficiaries), relieving their financial burden while they cope with your passing and look for other means of income.

    But pay serious attention to cases where your life insurance won’t cover. These cases are called exclusions.

    Understand first what exclusions mean before signing on the dotted line of your life insurance policy.

    What do exclusions mean?

    Exclusions are cases for which an insurance company doesn’t provide coverage. Exclusions are part of any life and medical insurance policy practised across the insurance industry. 

    An example of exclusion is suicide or attempted suicide. Here’s an illustration. Person A loses her ability to use her pair of arms due to her attempted suicide. Unfortunately for her, as attempted suicide is part of her life insurance exclusions, she’s not qualified to receive a lump sum from her insurance. Tragically, should Person A die due to suicide, her beneficiaries won’t receive any death-related benefits from her insurance.

    Tragic, isn’t it?

    These are some other common “exclusions” in life insurance that you should know.

    1. Pre-existing conditions

    A “pre-existing condition” is a health condition that exists before you apply for life insurance. These pre-existing conditions can range from mild conditions like allergies to critical illnesses like heart disease, diabetes, or cancer. 

    When applying for life insurance, you will have to make a written declaration of a few personal information including your full name, birth date, and your health conditions. The information must be provided to your insurer during your application or at most 12 months after your policy issuance date. What happens if you fail to declare your health conditions? Let’s look at the scenario below.


    Adam was diagnosed with epilepsy prior to his insurance application. He failed to declare his condition to his insurance provider during his application and within 12 months after his policy issuance date. One day while driving, he suddenly had severe seizures, causing him to lose control of his car. The accident left him permanently disabled. Unfortunately, he could not receive total and permanent disability benefits as the disability was indirectly caused by his pre-existing condition, epilepsy. 

    Learn from what happened to Adam. Remember to let your insurance agent know if you have any health conditions. It’s very important that you be honest by providing all information that your insurance requires. Not disclosing any required information may deny you from enjoying any benefits from your life insurance.

    2. Engagement in extreme professional sports or dangerous activities

    Cases that life insurance doesn't cover

    Some insurers will not pay any total and permanent disability benefit, should your disability be directly or indirectly caused by engagement in:

    1. Extreme professional sports such as:
      1. Scuba diving
      2. Racing
      3. Aerial flights (other than as a: 1) crew member, or 2) passenger on a licensed passenger-carrying commercial aircraft)
    2. Dangerous activities such as:
      1. Bungee jumping
      2. Parachuting
      3. Sky-diving


    After being homebound for a few months, Elly went sky-diving in Langkawi for a weekend getaway. Her holiday turned into a tragedy as she forgot to slow down on landing, disabling both of her legs when they came into contact with the ground. Unfortunately, Elly couldn’t get any total and permanent disability benefits from her insurance.

    What happened to Elly could happen to anyone. Before you think about participating in extreme professional sports or doing dangerous activities that could risk your life, please read your policy fine print as they may be exclusions under your policy. 

    3. Involvement in illegal activities

    Policyholders will also not receive any total and permanent disability benefit, should their disability be directly or indirectly caused by their involvement in illegal activities. These include:

    1. Invasion
    2. Civil war
    3. Insurrection
    4. Revolution
    5. Riot


    Linda took part in a riot. She sustained a severe injury from physical assaults during the riot. Her injury worsened and permanently disabled both of her arms. Linda couldn’t get any total and permanent disability benefits from her insurance as the disability was a result of her involvement in the riot, which is part of her life insurance exclusions.

    Carefully think about the risks of participating in any activities. You don’t want to lose any benefits from your insurance, especially after spending your hard-earned money on your insurance.

    The above are only some of the common exclusions in life insurance. Before purchasing life insurance, remember to ask your insurance agent to walk you through your insurance policy. Thoroughly read the fine print and get your agent to clarify anything that you’re unclear about before putting your signature on the contract. You can also consult non-commissioned insurance experts at Bjak for professional and unbiased advice at absolutely no charge.

    (Sources: The Economic Times, Life Insurance Association of Malaysia)