The last thing smokers think about is how their habit might affect their ability to obtain life insurance.
When smokers apply for life insurance, they’re often surprised and angry that the fact that they smoke is an issue —- one that increases the cost of their premiums and for some insurance companies, results in them being denied insurance.
Everyone who applies for life insurance faces what is referred to as an “underwriting process,” a detailed analysis of present health and an in-depth discussion of finances. They are also be asked about any family and medical history. All of these details are part and parcel of determining how much a policy premium or premiums will cost.
It should come as no surprise that an insurance company prefers to insure the youngest and healthiest individuals that they can, people who can afford to pay them for a long time. It’s about running a business. If someone who smokes two or more packs of cigarettes a day wants life insurance, their rates, if they are accepted, would be much higher due to the increased risks they face, health-wise.
How does an insurance company figure out your premium rate? They take several things into consideration, including, but not limited to: how tall you are; how much you weigh; your age; whether you have cancer or not; if you drink or smoke; your blood pressure and cholesterol levels; your family medical history; your occupation and income, and if there are genetic diseases that run in your family.
Depending on the business philosophy of the insurance company, you may be declined, or offered a premium rate or accepted but ridered, if you are able to prove you are actively controlling a health condition. Each company looks for different factors, which is why you will get a different response from each one you approach.
So, if you smoke, there are usually six categories insurance companies use to determine if you are a risk to insure, and if so, how big a risk. Those categories are: preferred plus no nicotine, a classification that gives the best rates available to those in tip-top shape and earn a high income; preferred no nicotine, for those who did not make it into the first category; preferred nicotine, for individuals who smoke, but are healthy, can expect up to triple premium rates; standard no nicotine, for those with other health issues and premiums are high; standard nicotine — even higher premiums here; and substandard, a category with the highest rates that may include cancer survivors or obese individuals.
As you can see, smoking does affect your insurance premiums, and it could cost you a great deal of money to get life insurance. While this is a tough issue to discuss, it is honestly best for those who do smoke and want to take care of their families, to try and alter their lifestyles.