How Being a Smoker Affects the Cost of Life Insurance

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When you apply for a Life Insurance policy there are a number of health related questions that are asked. One of those is whether you are a smoker or a non-smoker. On that point alone insurance companies will charge a higher premium if you are a smoker. This is because a smoker has a statistically higher mortality rate (see my article: Life Insurance and Your Mortality) than a non-smoker.

Each insurer will define how you qualify as a non-smoker and by default if you don’t qualify you would be considered a smoker. An example of non-smoking qualification may be that you have not smoked in the past 12 months and have no intentions of smoking tobacco or any other substance in the future. Policies differ, so if you want to understand this in context of your situation you must speak with a qualified insurance adviser.

A study conducted by the American Cancer society found that the average smoker has about a 1 in 6 chance (16%) of developing lung cancer in their lifetime. The average non-smoker on the other hand has less than a 1% chance of developing lung cancer in their lifetime. It also found that smoking is responsible for an increased risk of cardiovascular diseases and other lung diseases such as pneumonia and bronchitis.

Simply put, if you have a statistically increased chance of being disabled or dying from any disease a life insurance company will charge you a higher premium. If the act of smoking increases the probability of suffering a disease more so than a non-smoker then there is an additional cost. Smoking may cost you an additional 30% to 50% on the premium of a non-smoker. The insurer does this to ensure they have the pooled funds necessary to offset future claims and not penalise non-smokers.

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