Smoking Can Harm Your Insurance Too

Smoking is not just a burden on your health but your finances as well. There is the direct cost of purchasing them and the accrued cost over time can be ridiculously high. The collateral financial cost of smoking is the negative impact it can have on life insurance. Smokers more than other clients will be more likely to suffer serious illness or die as a result of the habit, and so companies know there is a higher standard of risk involved when offering them life insurance.

Smokers will no doubt be quoted higher costs because policies are taken out over the long term. The variation in quotes is stark in its honesty. For example, a policy which has the lowest price quoted for £200000 of life cover for a smoker over 25 years with critical illness cover included on a single basis, will be £4503 dearer for him/her as opposed to most policies for non smokers.

If a smoker is thinking of bending the truth when applying for a policy, the best advice is not lie at all. By saying a person is a non smoker on their policy-despite cutting a 20 cigarette habit a day to, say, 2-they run the risk of their policy being declared void or even fraudulent. If a person hides the fact about their smoking and this lie is discovered when the insurer is assessing a claim, they can easily refuse to pay out. The discovery can be even more embarrassing as the client may even be asked, as part of the application process, to undertake a saliva test to confirm that their non-smoker status. If the lie is then discovered for example, the application may be declined and other insurers could then refuse to cover the individual.

The key number is 12 months. That is all a smoker has to survive to gain a better life insurance quote. After a year of not smoking, life insurance companies start to class you as a non-smoker, and being a non-smoker can result in premiums of life cover and critical illness cover being 50 per cent lower. Of course a cheaper premium is not a certainty, as it depends on age and health but by ceasing the habit, the client stands a much better chance.

The best advice then to a smoker is obviously to quit the habit, and after doing so if the individual has honestly survived the 12 months without a cigarette then they should tell their insurance company straight away. Furthermore, the individual would be well placed to research the insurance market and find the best deal when renewing the policy-the likelihood being that the best premium will be from a new and different life insurance provider.