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Financial Planning > Trusts and Estates > Estate Planning

Assisted suicide & estate planning: issues to weigh

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It’s a topic that nobody much wants to talk about. But it eventually crosses the mind of many elderly people who face the end of their days because of chronic illness: physician-assisted suicide.

An idea that once revolved around the lone efforts of Dr. Jack Kevorkian in Michigan has now gone mainstream. Later this year, California, the most populous state in the nation, will become the fifth state to legalize some form of physician-assisted suicide.

Oregon passed the nation’s first assisted-suicide law in 1997, followed in 2008 by Washington State. In 2009, the law was legalized by court order in Montana, and Vermont passed a similar law in 2013.

Now, it’s California’s turn. The state assembly passed an assisted-suicide law back in September, and it was signed into law by Governor Jerry Brown in October. Later this year, 90 days after the Legislature adjourns, the practice will become legal in California.

It’s no surprise that more states are making it available to their citizens. About two-thirds of Americans say they support the concept of assisted suicide. Given the momentum of the legal victories won by proponents, it’s safe to say the practice will become more widespread.

As the movement grows, more estate planners will have to consider the issues around assisted suicide. Perhaps foremost is how it interacts with life insurance, a critical part of many clients’ estate plans. The little data we have on people who have used the Oregon law indicates that they tend to be upper-middle-class: the median age is 72 years old; and three-quarters have at least some college education.

One aspect of life insurance contracts that may give clients pause: the common provision that a policy does not pay in circumstances involving suicide. Some policies will pay benefits if the policyholder takes his own life, as long as the policyholder held the life insurance policy for two to three years, depending on the carrier. The idea is to deter people with suicidal thoughts from buying an insurance policy, knowing their beneficiaries will be able to take advantage of it soon thereafter.

Most people with terminal illnesses are older folks who are likely to have had life insurance policies for some time. So this issue may only affect those who are interested in beefing up their insurance as they reach the end of their lives.

But the assisted-suicide laws have dealt with this issue. Oregon’s law requires insurance companies to settle policies of physician-assisted suicides even if the death occurs less than two years after purchasing the policy. It requires all parties to treat the assisted suicide of such a patient no differently than natural death.

That makes sense: Physicians are only allowed to help a patient end their life if that person is already suffering from a terminal illness. This person is going to die in the near future, whether the physician steps in or not, so it would be cruel to invoke the suicide provisions to deny the patient’s heirs their insurance proceeds. This same requirement obtains with life, health, and accident insurance policies as well.

Given the understandable concerns around them, these procedures are heavily regulated. California’s new law, for instance, has all the following safeguards:

  • The patients must be judged to be a competent adult, with no diagnosed mental disorders.

  • Doctors must meet privately with each patient, with no other family members in attendance, to ensure they aren’t being coerced into suicide.

  • Two doctors have to attest that the patient has less than six months to live.

  • Two oral requests for life-ending medications must be made at least 15 days apart. There must also be a written request.

  • Only the patient’s attending physician can prescribe the medication.

  • The patient must administer the drugs to himself or herself – they are not to be administered by the attending physician.

Those rules are designed to prevent the assisted suicide laws from being abused. The primary concern of most of those drawing up these laws was to ensure that the decision was absolutely certain and unmistakable for anyone making use of it.

Physician-assisted suicide is not something that anyone wants to talk about – but it is a reality for many people in this country, and likely to become more common as the legislative movement gathers steam. Proactive estate planners will familiarize themselves with its parameters. Thankfully, the legislators who have established these laws have made sure that the patients using these tactics aren’t financially disadvantaged by their decision.

See also:

Letter changing beneficiary day before policy owner’s suicide was effective: court rules

Suicide is a new disturbing trend & what this means for employers

Williams post-mortem: Answers to 9 questions in suicide cases




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