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What Smokers Should Know About Buying Life Insurance

Find out how buying life insurance may be different for smokers, especially when it comes to the impact on the cost of premiums.

If you’re a smoker and you haven’t shopped for life insurance, you’ll be in for a big surprise.

Even if you’re otherwise in excellent health, your smoking habit alone can cause your life insurance premium to multiply several times.

It’s unlikely you’ll be declined as a smoker, but you should expect to pay a much higher premium.

Why Smokers Have Different Life Insurance Rates

When evaluating any applicant for life insurance, the insurance company must consider the risk the person presents.

In evaluating that risk, insurance companies attempt to minimize the number of people within their insurance pool who are likely to die early.

After all:

For an insurance company to make money on a policy, the policy must be in force for a certain number of years.

For that reason, they attempt to identify applicants who are at risk of an early death due to known health conditions.

That doesn’t necessarily mean an applicant with a health condition will be declined.

But to adjust for the higher risk, the insurance company will charge a higher premium for someone with one or more significant health conditions than an applicant who is in perfect health.

One of the biggest risk factors for a life insurance company (or a health insurance company) is smoking.

Though it’s not a health condition in itself, it’s a behavioral factor that’s closely linked to a large number of serious health conditions, many of which can lead to an early death.

According to the Centers for Disease Control (CDC), more than 16 million people in America are living with a disease attributed to smoking.

The list of health conditions is a long one, including:

  • cancer
  • heart disease
  • stroke
  • lung diseases
  • diabetes
  • chronic obstructive pulmonary disease (COPD)
  • tuberculosis
  • certain eye diseases
  • conditions related to the immune system including rheumatoid arthritis

Most life insurance companies will provide coverage for a smoker.

However, if you are a smoker you should expect to pay substantially higher premiums than you would if you were a non-smoker.

Smoking vs. Non-Smoking Life Insurance Rates

Not only do smokers pay more for life insurance premiums than non-smokers, but the difference isn’t small either.

A smoker can expect to pay a premium that’s between two and four times that of a non-smoker with an otherwise equivalent insurance profile.

"Preferred smoker rate"

Now there is some good news on the premium front for smokers.

Some insurance companies do offer a “preferred smoker rate”.

You can qualify for this lower rate structure if you are a smoker but otherwise in excellent health.

And generally speaking, you’ll also need an excellent health history in your extended family.

If you are applying for life insurance as a smoker, you should apply with one that does have a more favorable view of smokers. Those companies are likely to offer preferred smoker rates.

Still:

You’ll pay more than you will if you are a non-smoker.

But the premiums are likely to be lower than those quoted above.

What Counts as “Smoking”?

This is the part that trips up a large number of self-described casual smokers.

Unfortunately for smokers, insurance companies don’t differentiate based on how much you smoke, or even what type of tobacco or nicotine products you consume.

For example, you may think of yourself as a casual or occasional smoker because you only smoke one pack of cigarettes per week.

In coming to that conclusion, it’s likely you’re comparing yourself with other smokers who smoke one or two packs every day.

However, the insurance company won’t see it that way.

They’ll still classify you as a smoker even if your cigarette consumption is on the low side.

Marijuana and cigars

Another reason you may not consider yourself to be a true smoker is that you don’t smoke cigarettes directly.

For example, you may smoke marijuana or even cigars or a pipe on a regular basis.

An insurance company will almost certainly consider you a smoker even if you do.

Vaping and e-cigarettes

Another popular “non-smoker” belief is vaping and e-cigarettes don’t count. Because you’re not smoking actual tobacco, you may not think of yourself as a smoker.

However, since you are inhaling smoke into your lungs, and since nicotine is a common component in vaping juices, the insurance company will still consider you to be a smoker.

Chewing tobacco

Still another consideration is chewing tobacco.

Even though you’re not smoking it, you’re still consuming it and it can have similar negative health effects.

This is why life insurance applications often include very generally worded questions with regard to smoking.

The question may be “do you use tobacco or nicotine products?”, or simply “do you use tobacco.

How to Lose the Smoker Status 

It is possible to get reduced premiums if you quit smoking.

To do that, you’ll need to:

  • participate in a smoking cessation program
  • and be smoke-free for two years or more.

It would be best to join a smoking cessation program and be smoke-free for several years before applying for life insurance.

However, you may be able to participate in a program if you already have life insurance to get your premium reduced upon completion of the program.

Confirm the program with the insurer

You’ll need to contact your life insurance company and request the name of a smoking cessation program they consider to be acceptable.

Why?

Simply signing up for any smoking cessation program then letting your insurance company know you’ve completed the program is unlikely to satisfy the company.

But if you participate in an approved program, the insurance company is likely to lower your premium after completion of both the program and the minimum required time you’ll need to be smoke-free.

What If You Start Smoking After Buying Life Insurance?

The answer to this question is more complicated.

Technically speaking, once your life insurance application is approved it generally doesn’t matter what you do from that point on.

That said:

Insurance companies often bury certain provisions in the fine print of a policy.

For example, most life insurance policies specifically exclude paying the death benefit if the cause of death is the result of participating in an illegal activity, including a drug overdose.

But, it may be possible language is included that will prohibit the payment of the death benefit if you engage in certain activities that will endanger your health, which could include smoking.

Accusal of insurance fraud

There’s still another possibility even if a post-approval smoking habit isn’t specifically prohibited in the policy.

If you indicate in your life insurance application that you were a non-smoker, but you die as a result of an illness caused by smoking, the insurance company can claim insurance fraud.

Since they don’t know exactly when your smoking habit began, they can assume it started before you made an application and failed to disclose it.

They can then deny the benefit claim as insurance fraud.

Now it wouldn’t be as simple as that.

If you in fact were not a smoker of the time you applied for coverage, your beneficiaries would be able to challenge the claim of insurance fraud.

However, that can involve a prolonged legal battle that will not only delay the payment of the death benefit, but also involve legal fees.

How Life Insurance Companies Find Out That You’re a Smoker

Avoiding a smoker classification for life insurance purposes isn’t nearly as easy as simply omitting the information from your application.

There are several ways the insurance company can discover your smoking habit.

Medical exams

If they conduct a medical exam, which is more common than not, your bodily fluids will be collected and analyzed. This can include blood, urine, or even saliva.

Any one or a combination can be used to determine nicotine use, even if it’s only occasional.

Industry databases

The life insurance companies typically rely on industry databases to obtain your medical history.

The most common source is the MIB which is a health database commonly used in the insurance industry.

Since the database tracks your health history for many years, even extending back to childhood, it’s very likely there is a record of your smoking at some point.

Either you admitted to smoking during a medical visit, or previous medical tests determined your smoking habit.

You should also be aware that if you claim non-smoker status on your application, and the habit is revealed either by medical tests or medical database information, your application will be declined.

That will be the best possible outcome, because if the policy is approved and you’re later determined to be a smoker, the insurance company can deny paying the death benefit to your beneficiaries.

Key Takeaways

The basic facts of smoking and life insurance are as follows:

Smoking – or virtually any type of tobacco or nicotine use – will result in substantially higher premiums.

You may be able to get reduced premiums if you make an application with an insurance company that takes a more favorable view of smoking and offers preferred smoker rates.

If you already have a policy in place and you’re paying premium rates at the smoker level, you may be able to get those premiums reduced by completing a smoking cessation program approved by your insurance company.

Notably:

Never lie about your smoking habit on a life insurance application.

The insurance company has too many ways to learn the truth, and they can deny a claim based on insurance fraud if you claim to be a non-smoker when you are.

As you can see, insurance companies consider smoking to be a very serious matter. If you are a smoker, be honest on your application, and work with a company that’s known to specialize in life insurance for smokers.

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