Quit smoking and save a bundle on your term life premiums

Where there is smoke... there’s high life insurance premiums.

We all know the health hazards of smoking. It shortens life expectancy and makes you more susceptible to health risks. The thing is, despite the Surgeon General’s warning and well-publicized anti-smoking campaigns, people sometimes just can’t resist the lure of “enjoying a smoke”.

But smoking does not only burn a hole in one’s health – it does the same for one’s pockets when it comes to life insurance.

A smoker’s life insurance premiums will be considerably higher than a non-smoker of the same age, same coverage and same general situation. In fact, smokers may expect to pay as much as twice or thrice the standard rate!

When applying for a term life insurance policy, one of the items that will be asked is your tobacco consumption in the last 12 months. This includes all products containing nicotine, such as cigarettes, cigars, chewable tobacco and even a nicotine patch.

When you are applying for a life insurance policy you will be inquired about your usage of tobacco products in the last 12 months. This includes all products such as cigars, cigarettes as well as chewing tobacco. The frequency of usage also needs to be mentioned.

Some sample premium computations (non-smoker vs. smoker):

Factors that could further affect a smoker’s premiums:

• Age
• Presence of existing medical conditions (i.e. heart disease, diabetes, etc.)
• Gender (Male smokers get higher premiums than female smokers)

These are some factors that could drive premiums even higher, depending on how frequent the Person Insured smokes. In some instances, if an existing medical condition has severe symptoms, a smoking habit may cause the Insurance Company to decline the application.

Disclosing Your Smoking Habit

For those who are thinking of getting a term life insurance policy, your smoking (or quitting) is an important matter. When applying, it is best to be upfront regarding your smoking habits – that way, this will not be a matter that will affect your future claims.

The insurance company may cancel your policy if they find out that you have not been honest regarding your smoking, particularly within the waiting or contestability period. The waiting period is a time when the insurance company can contest any claims or cancel a policy due to misrepresentations of key facts about your insurance application.

This may be particularly disappointing if your family is making a claim only to be denied due to the fact that your death may have been attributed to smoking.

Applying for Lower Premiums

Depending on how your policy is built, your premiums may be up for review at specific periods. For instance, if you get a term life policy where the premium is renewed every five years, the life insurance company will go through the underwriting process to determine your new premium for the next five years.

This means that if you have already been paying high premiums due to the fact that you have been smoking, you still have the chance to get lower premiums for the next review. For premiums to be lowered and for you to be re-classified as a non-smoker, you may need to have quit for at least a year. This depends on the underwriting policies of the insurance company.

So if you want to save on premiums, we suggest that you study how you can kick the smoking habit. Once you do, you can enjoy a healthier and longer life as well as lower premiums!

Updated on: 05.06.2013

To secure your family's future, fill in the form on the right and get your term life insurance quote now.