Smoking and Life Insurance 101

Smoking alters the life insurance underwriting process drastically. Read on to learn the fundamentals of how and why tobacco use impacts life insurance coverage and rates.

The Correlation between Risk and Premiums

Regardless of the type of insurance policy, premiums are a reflection of the risk the policyholder poses. In other words, the rates the insured pays are based on how likely the insurer believes the policyholder is to file a claim. Applying this concept to life insurance, risk refers to the likelihood that the insured will die, thus resulting in a claim. This principle explains why smokers pay more for life insurance coverage-they have a higher mortality risk. To offset this added risk, life insurers charge higher smokers life insurance rates. No matter what life insurer you choose, the smokers life insurance quotes you receive will be higher than those of an applicant who does not use tobacco because of the concept of risk.

Smokers' Mortality Risk

You might wonder if the disparity between smokers life insurance quotes and those of nonsmokers is really justified. The difference between the rates of smokers and nonsmokers is based on complex historical data of the mortality rates of different groups of people. Life insurers maintain statistics on the death rates of various groups of people according to age, gender, weight, and lifestyle choices like smoking or drinking. Smoking is one of the strongest predictors of death among all types of policyholders. In fact, according to the Centers for Disease Control, female smokers lose an average of 14.5 years of life, and male smokers lose an average of 13.2 years of life. These elevated mortality rates are why smokers life insurance rates are so much higher.

Qualifying as a Smoker

In the eyes of life insurers, it's easier to qualify as a smoker than you'd think. You will most likely have to look for smokers life insurance quotes if you used any tobacco product in the last three years. When you apply for your policy, your life insurer will usually ask you if you've smoked a cigarette, cigar, or used any other tobacco product in the last one year, two years, and three years. You will be categorized as a smoker if you answer "yes" to any of the questions. In other words, even if you only smoke three cigarettes per year, your insurer will probably still charge you smokers rates on life insurance.