Life Insurance for Smokers in 2021: Bringing Costs Down to Earth
Updated: Jan 26
Smokers can pay less for life insurance if one knows where to look. Find out how insurers test for nicotine and when it doesn't matter.
If you smoke cigarettes, vape, chew tobacco, or use marijuana, you're much more likely to pay more for life insurance than if you didn't. In the life insurance market as a whole, people who consume nicotine products pay two to three times more for life insurance than non-smokers, depending on the insurer, however the smokers penalty can be reduced to zero with select products discussed in this post. Insurance companies know whether an applicant consumes nicotine based on urine test results and medical records. People tend to answer the application questions honestly in order not to give the insurer grounds to contest the claim. As for quitting, insurers will not consider granting non-nicotine rates until at least one (1) year has passed since the date of last nicotine use.
Insurers have different ways to verify nicotine consumption.
Different intake methods are basically treated the same for purposes of determining the cost, whether you smoke, vape, chew, or use marijuana.
Former smokers may be eligible for non-nicotine rates, but it takes at least a year.
Certain carriers and products are more favorable to smokers than others.
How Do They Know?
On the application form, you'll be asked whether and how often you smoke or use nicotine. A typical question will be asked in a very broad context, such as
"Have you ever used any nicotine products, including but not limited to, cigarettes, pipes, cigars, chewing tobacco, lozenges, e-cigarettes, vaping, patches, or drugs to aid in the cessation of nicotine products."
That's a very broad question. The "ever" part is only asked by a few insurers, with most insurers framing the question within a limited period of time, such as "within the last 12 months" and then another question regarding "the last 24 months."
The application constitutes your representations which the insurer relies on to issue the policy. If you misrepresent yourself, they may contest your representations, especially if death occurs within the first two (2) years. If a claim is filed within the first two (2) years, expect the insurer to comb through your medical records prior to paying the claim to make sure you represented yourself accurately and completely. Due to possibility that medical records could be audited, it makes no sense to take a chance.
Carriers with the lowest rates require an exam in order to test for nicotine in the urine along with a blood chemistry profile. Nicotine stays in your blood for up to three days, but cotinine — a byproduct of your body metabolizing nicotine — lasts about three (3) weeks. The life insurance medical exam will test for both nicotine and cotinine to determine whether you smoke or use other nicotine products. But even if you can go without nicotine for that long, keep in mind that the exam is not the carrier's main defense against misrepresentation. Your medical records may also evidence nicotine, which you should assume they will review prior to issuing your policy.
Misrepresentation carries a potentially huge risk of burning bridges with the entire marketplace of insurers in a single step. If the underwriter does find evidence of nicotine use, and you didn't admit to it on the application, it will be reported to the MIB. The MIB (Medical Information Bureau) protects member insurers from misrepresentation based on the experience of other member insurers. It does this in two ways - by revealing nicotine history to the insurer you apply with, and by reporting non-admitted risks. So if you have a non-admitted risk in the MIB report, you are far more likely to be declined with the second insurer due to adverse presumption.
How much you smoke doesn't matter
Life insurers define a smoker by nicotine use regardless of quantity. Cigarettes, chewing tobacco, and vapes all count, though some insurers are flexible on the question of the occasional cigar provided the urine and medical records don't indicate the presence of nicotine. Smoking cessation products such as gum and nicotine patches count as nicotine use. Although cessation products are technically not "smoking," insurers will still count them as nicotine consumption for purposes of determining their risk.
Life insurance rates for marijuana users, on the other hand, are more likely to depend on the degree of consumption. Marijuana does not have the same history as tobacco as far as social integration, daily habituation, and addiction. The legality of marijuana has no impact on mortality, other than what it might to do cause usage to increase, so for the moment the main impact of legalization has been to force insurers to draw their own lines regarding how much marijuana consumption would kick a person into the smoker class category. In the absence of industry data to draw from, some insurers that are more tolerant of marijuana use than others. On the more generous side, 3 hits per week can still qualify for non-smoker rates. Crucially important is to be honest on the application. If marijuana is detected but not admitted to on the application, the outcome will be an outright decline (no matter how small the consumption) and a lasting mark in the MIB database which could make it hard to acquire coverage elsewhere.
How much more expensive is life insurance for smokers?
As mentioned above, smoker or tobacco premiums can be two to three times higher than nonsmoker premiums for a typical term life insurance policy with a level premium guarantee of 10-20 years. The variation depends on the guarantee period, with a 20 year term period costing about triple and a 10 year term period costing about double. As a general rule, the smoker penalty declines as the guarantee period gets shorter. The shortest guarantee period is one year at a time, which is annual renewable term life insurance. With annual renewable life insurance (where the premium increases annually), some carriers impose absolutely no smoker penalty at all.
Sounds like annual renewable term is the way to go, right? If your scope of need is short, that's absolutely true. Annual renewable life insurance may also be the best decision if you don't want to pay for long term guarantees (at smoker rates) that you may end up not needing. Just in case things change and you end up needing to continue coverage, consider getting a policy with an option to continue or convert coverage without having to medically re-qualify.
Carrier options for annual renewable term life insurance depend on a number of individual factors. Use the quoting tool below to find out what it would cost for you (anonymously).
Life Insurance Quote for Smokers (2021)
Why smoker life insurance rates may not matter
Because smoking, e-cigarettes, and patches are so common and are associated with health risks, life insurers divide applicants into smoker (or tobacco) and nonsmoker (or non-tobacco) classes. Even if you’re otherwise very healthy, receiving a nicotine classification has the potential to increase your premiums significantly compared to someone designated as a standard non-smoker.
But that difference is not worth agonizing over if
the premium is small to begin with, or
you buy annual renewable term insurance, or
you later quit and apply for a re-rating or replacement policy, in which case you would have paid smoker rates for only a short time.
If you recently quit smoking, you may wonder if it would be best to wait to apply for life insurance until you can qualify for non-smoker rates. One obvious problem with waiting is that you could die or become uninsurable before you get around to applying. But the more important reason not to delay is that applying now still offers you the same chance to get non-smoker rates through what is called a re-rating or reconsideration, which means that you can request that the policy premium be reduced based on a favorable change in your risk. Almost all insurers that use agents to distribute their products will entertain re-rating and the process is quite simple. An exam, which would be arranged by your agent, would be required to prove that you are nicotine-free.
Is life insurance for smokers worth the cost?
In an efficient marketplace where insurance companies compete against each other, rates approach the actual cost of paying claims. The question of "worth" is best determined by how your family or your business would get along in the absence of insurance. Besides, the smokers penalty is negligible for annual renewable term life insurance, and may be only temporary if you apply for a re-rating after you quit. The important thing for now is to secure your insurability.
Life insurance for smokers FAQs
Can I get life insurance if I smoke? Yes, you can still get life insurance if you smoke, but you’ll pay increasingly more for products with longer guarantee periods (the term period). Additionally, smoking may make it more difficult to qualify if you have other health conditions such as diabetes, obesity or cardiac history.
How much more does life insurance cost for smokers? It depends on the guarantee period. For 10-20 year terms, smokers pay about 2-3 times as much for life insurance compared to nonsmokers. For one-year-at-a-time policies (annual renewable term), there may be no difference (see below).
How long after quitting smoking can I qualify for non-smoker life insurance rates? To qualify for non-smoker rates, most companies require you’re smoke-free for at least one year. It doesn't make sense to wait because most policies will permit you apply for a rate reduction if you quit, after 12-24 months, which is a safer approach so as not to risk losing your insurability.
What does Annual Renewable Term life insurance cost for smokers? A quoting tool is provided here, which will produce a quote anonymously and instantly.
No personal information is required for the quote and no agent will contact you. After you press Show the Quote, an insurance product will be identified based on your inputs, along with the cost, a link to consumer materials, and agent information.