However, it is difficult to establish at a later date whether you were a smoker when you bought the policy, as you could have started smoking after the policy was issued.. The reality is, if you’re a smoker, you may face higher costs unless you choose to quit smoking.
It is important for you to know that the difference in premium rates between smokers and non-smokers applies only when the term insurance plan is designed to offer separate pricing for each group. However, not all plans follow this structure. Some policies, particularly those with VMER (Very Minimal Extra Risk) rates, offer the same premium regardless of your smoking status. In such cases, whether you smoke or not will not impact the cost of your coverage.
By quitting, you reduce the risk associated with your policy, which could lower your premiums. Ultimately, quit smoking or lose coverage; this decision is critical to your health and financial protection.
Definition of smokers in life insurance
A smoker is someone who uses tobacco or nicotine in any form. This includes cigarettes, cigars, beedis, paan masala, gutkha, chewing tobacco, khaini, nicotine gum or patches, and e-cigarettes or vapes. If you consume any of the mentioned things , you will be classified as a smoker.. Insurance companies check if you smoke when deciding your premium. During the application process, you may be asked questions like: "Have you used tobacco in the past year?", "What form did you use?", and "How often do you use it?". Choosing to quit smoking can make a significant difference in both your health and the cost of your term insurance.
Types of smokers
Insurance companies group smokers into different categories based on their smoking patterns, health, and risk factors. The frequency and duration of smoking and overall health determine which category you fall into, affecting the premiums you are charged.
Preferred smokers
These are smokers who are otherwise fit and healthy. They don’t have significant health issues. Because of this, they may get better rates compared to others in the smoker category. However, the premium is still higher than for non-smokers.
Typical smokers
These smokers may have small health problems like high blood pressure or mild cholesterol. Their premium is higher than preferred smokers due to increased health risks. They may need extra medical checks before approval.
Table-rate smokers
People in this group have serious health issues like heart disease or lung problems. Due to the higher likelihood of severe health complications, they are charged the highest premiums. Sometimes, they may even be denied insurance depending on their condition.
How much extra premium is charged to smokers?
Smokers usually pay more premium than non-smokers of the same age and profile. The amount depends on factors like :
- Your age
- Gender
- Type of tobacco use
- Health reports
- Duration and frequency of use
For instance, the annual premium for a non-smoker may be ₹10,000 while a smoker with the same insurance will pay between ₹15,000 and ₹20,000. These costs are increased for smokers because smokers have a shorter than average life expectancy and a higher risk of developing cancer, heart disease, and other serious illnesses.
What happens when you hide your smoking habit?
If you do not provide the proper disclosures to your insurer about your smoking habit, it could lead to serious problems. If a death claim is made due to a smoking-related illness, the insurance company can deny it, if the person lied or hid their smoking habit when buying the policy. . Always provide honest information on any form. This will protect your policy and your family when they need assistance the most.
What happens if you quit smoking after being insured?
If you quit smoking after you buy a term plan, your premium doesn’t reduce automatically. The plan was priced based on your smoker status at the time of purchase. Most companies won’t reclassify your policy to a non-smoker just because you quit. But if you stay away from tobacco for a few years, you can apply for a new plan as a non-smoker. However, your age will be higher by then, which may raise the premium. So, while quitting smoking won’t impact your current policy rate, it can help you secure better premiums when purchasing a new policy. Be sure to provide medical proof of being tobacco-free and maintain a consistent non-smoking lifestyle.
Conclusion
Smoking impacts your health and your cost and coverage for term insurance. Whether your smoking habits consist of smoking an alarming amount or you engage in sporadic smoking, insurance companies will treat and categorize you as a smoker and subsequently set your premiums accordingly. Being an honest person during the insurance application process not only prepares your family for future problems but also avoids any misunderstanding. Failure to disclose your smoking habits could result in claim rejection. Quitting smoking not only will save you money and make you healthier, but it could, over time, lead to better terms in your term insurance coverage. So, here is some sound advice: quit smoking, be honest, and protect your family financially the best you can.
FAQs
Is term life insurance better for smokers or non-smokers?
Term insurance is useful for both smokers and non-smokers, but non-smokers typically pay lower premiums for the same life cover. They typically pay less for the same life cover. This is mainly because they are healthier and will live a longer life. Smokers have more potential health issues and risk factors, such as heart or lung disease, so they have to pay more. Even then, term insurance is extremely important for a smoker. It can ensure your family has a monetary safety net to support them in case of your unfortunate demise during the policy term . Simply put, regardless of the smoking habit , having a peace of mind and security of coverage is valuable for any family. The bottom line is to evaluate the right plan and be honest.
How do term insurance providers verify if an applicant is a smoker?
When you apply for term insurance, the company asks you some simple questions about smoking. They may ask if you have used tobacco or nicotine in the last 1 to 4 years. Then, they might ask you to take a medical test. This test checks your blood or urine to see if you have nicotine in your body. These tests help the company to know your health risk and decide your premium. If you smoke, be honest. If the company finds out later that you hid your habit, they may cancel your policy or deny your family’s claim.
Which term insurance is best for smokers?
The best term insurance plan for smokers is one that gives you good life cover, fits your budget, and has a simple claim process. Look for plans that also provides add-ons like critical illness cover or accidental cover. Choose a trusted insurance company that has a good claim settlement ratio. Talk to the insurer and read the terms carefully. Pick a plan that matches your needs, and be honest about your health habits while applying.
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