Under the standard 'suicide clause' in a Canadian life insurance policy, what happens if the insured commits suicide three years after the policy was issued?

Question: Under the standard 'suicide clause' in a Canadian life insurance policy, what happens if the insured commits suicide three years after the policy was issued?

Answer options:

• The death benefit is never paid in the event of suicide.
• The death benefit is paid if the suicide occurs within the first year. ✅ The death benefit is paid if the policy has been in force for at least two years.
• Only the premiums paid are returned, regardless of when the suicide occurs.

Correct answer: The death benefit is paid if the policy has been in force for at least two years.

Explanation: The 'suicide clause' typically excludes coverage if the insured commits suicide within the first two years of the policy. After two years, the death benefit is paid.