Smokers are likely to have a shorter lifespan. They are also susceptible to more health issues compared to their non-smoking counterparts. Cigarette smoking puts them at more risk and so they must pay more for a cover.
In fact, the premiums they pay will range between 40% to even 100% more than what their non-smokers will pay. It does not matter whether you are just starting or you have just smoked only a few cigarettes.
Smoking and Life Insurance
According to studies, chances are high that occasional smokers may turn into regular smokers. They are likely to become consistent users of tobacco. So they must dig deeper into their pockets for a life insurance cover.
But most smokers think that they can lie about their smoking habits when they are applying for a cover. Well, even if you get away with it during the exam, it will be short-lived. Your benefits will not be paid if you die from smoking-related ailments such as cancer and heart attack.
Of course, any person who has not smoked for the past 12 consecutive months will pass the exam. They will be allowed to enjoy the smoke-free status. But if they start smoking after taking the cover and die from tobacco-related diseases, they are likely to lose the benefits.
That aside, it is critical to note that life insurance rate will depend on your current health status. It is also determined by your lifestyle choices. Smoking, for instance, will lead to higher premiums.
This may make it difficult for you to take a life insurance cover. It means that it may not be easy for your dependent to get death benefits when you die. They may find it difficult to pay your debts, offset living expenses, mortgages, and even loans.
Here is How Smoking Affects Your Policy
During the underwriting process, the insurer will review the health risks you carry. If you have used cessation or tobacco products in the past 1 year, the exam will show this.
The insurer will then calculate the amount of money to pay as premiums depending on the risks you carry. The higher the risk levels the more the premiums you pay.
For instance, a 20-year non-smoker who takes $200, 000, 30-year life insurance policy may be required to pay $50 per month. While a person of the same age but who smokes may be required to pay $100.
If after 30 years, the non-smoker joins the smoking club it complicates matters. If they decide to renew the policy they will be required to pay more than $100 per month. So, a non-smoker should remain tobacco-free if he wants to benefit from a life insurance cover.
On the other hand, if the smoker decided to quit the habit a year before renewing the term, they are likely to pay less. Thus, there are good reasons for the insured to consider quitting smoking. It will help them a cheaper life insurance cover.
Who Is A Smoker In The Eyes Of Life Insurance?
- People who use nicotine and tobacco regularly.
- People who smoke cigarillos, cigarettes, and cigars.
- People who chew tobacco.
- So anyone vaping will be categorized as a smoker.
- Individuals using cessation products such as patches and nicotine gum.
Note that even vaping will affect your cover. What matters is whether nicotine is in your urine or blood.
Will buying a cover online make things better for smokers?
Yes, it is difficult for online providers to distinguish between an applicant who smokers and non-smokers. Thus, the providers charge blended rates so you end up paying between what a non-smoker and a smoker would pay. So the premiums the smokers pay will be lower.
Benefits of Quitting Smoking
If you quit smoking a year before you take the cover, you are likely to pay lower premiums. But the insurer will also get interested in knowing what made you quit. If you quit so that you take a cover, chances are that you will go back to the butt.
So, the insurer is likely to ask you to pay higher premiums. Also, they may want to know if the habit has affected your health. If it has, they will charge you more because the risk level is high.
For instance, a person who quits smoking after he survives a heart attack is still in the high-risk group. So they will still carry the smoker rating even after they quit. They will be required to pay higher rates.
Can Smokers Get a Life Insurance Cover?
Yes, you can get a cover even if you smoke. In some cases, you will even get instant approval. But obviously, smoking will hurt your rates.
Why the Rates are High for Smokers?
Insurers are aware that smokers lead a poor lifestyle. Also, they lead an inactive lifestyle. So they are exposed to more risks than non-smokers.
What is the Way Out for Smokers?
Now since it is difficult to hide the fact that you smoke. You must tell the truth. So when this question is brought to you, give an honest answer. Saying no when you smoke is fraudulent. Besides, you will be taken through exams including urine and blood tests. If you test positive for tobacco, your chances of getting fair rates will diminish.
Also, some research on policy carriers could be beneficial. Some carries view tobacco usage positive and do not penalize smokers too much. So it will require that you sample a few of them to determine whether they are favorable or not.
Some insurance uses the first two years as a contestability period. It means that if you die during this period your people may be denied the pay-out benefits. This will happen if it is discovered that you were smoking,
Thus, being honest is the best thing to do if you are a smoker. If you are honest and you die, the payout will be made. Also being honest will generally make the process easier. It helps the company to get the info it needs to work out your rates.
What About Chewing Tobacco?
If you chew tobacco, you may need to disclose the same. What happens is that the test for nicotine will always be positive whether you chew or smoke tobacco. Yet the rates for these two categories of people are different.
Those who chew tobacco are exposed to fewer risks so their rates are always low. Some insurance companies give applicants who use smokeless tobacco a clean bill of health. Such people are likely to enjoy lower rates.
You must also disclose if you smoke electronic cigarettes. Companies will give favorable rates to electronic cigarettes smokers. However, some companies lump them together and subject them to smoker’s rates. So letting the company know what is happening will help the underwriter decide what to do.
Is Quitting Smoking Helpful?
Yes, most insurance companies encourage people to quit smoking. Those who quit a year before taking the cover are entitled to smoke-free cover.
Also, those who quit smoking while they have the cover may qualify for some discounts. But it all varies from company to company. If you quit smoking, all you need to do is to request for a health exam. If you come out successful, you can request for non-smokers rates.
Should One Wait for a Year to Lapse After Quitting?
No, all you need to do is to disclose your status and buy the smokers policy. Once you quit smoking, go for a test. If it turns negative, you can request for non-smokers rates. Most insurance companies will allow you to get the best rates as soon as you pass the exams.
Getting Enough Coverage
Whether you are a smoker or not you must get the right coverage for your family. Look at your level of debts and the final expenses. Consider the car loan, the mortgage payment that your family will be required to pay after you pass away.
Also, if you plan to have your life insurance replace your income, buy adequate coverage. It will reduce the struggles your family is likely to go through when your paycheck stops coming.
New Insurance Products For Smokers
As competition gets stiffer, insurance companies have come up with programs that give smokers a chance for a cover. It is a strategy to help them to access covers at cheaper rates. In some of the products, you will be charged the same amount of premiums as what is charged to non-smokers.
Products to Encourage People to Quit Smoking
A few providers have designed life insurance products that target smokers. The products are intended to encourage people to quit smoking. The products provide cover to smokers with a promise to upgrade them to non-smoker rates if they quit smoking.
They may insist that one should quit smoking in the second or third year. Also, smokers may be offered the option of having the death benefits remain at the same level if they quit.
Alternatively, the benefits may be reduced if they choose to continue smoking. All these are meant to encourage them to take a life insurance cover and quit smoking.
But to enjoy the non-smoker rates, the insured must provide evidence that they no longer use nicotine products. They must also prove that they have not smoked cigarettes in the past 12 months. This is a win-win situation that targets to benefit both smokers and the insurer.