Smoking can increase the cost of life insurance by 65%

New research by MoneySuperMarket has revealed that smokers cough up to 65% more for life insurance. Lighting up can cost an extra £312 every year.
 
Insurers do not distinguish between daily, occasional or social smokers – if you’ve smoked in the past 12 months you’re classed as a smoker. With their long-term effects on health yet to be agreed by experts, e-cigarettes are also viewed in the same way as normal cigarettes for life insurance purposes.
 
The health risks that come from smoking are unquestionable which is why premiums are so much more expensive.


Analysis of quoted premiums for life insurance policies between January and April 2018 reveals that, on average:

Smokers pay £26.07 more for decreasing term insurance with critical illness cover (CIC) included
Smokers pay £16.59 more for level term cover with critical illness cover included – 48 percent more than non-smokers

With decreasing term insurance, the amount of cover reduces over the term of the policy, usually to reflect the reduction in the amount owed on a capital and interest mortgage. With level term insurance, the amount of cover remains the same for the duration of the policy.
 
According to data, the highest proportion of people who have smoked within the last 12 months are between 36-45 years of age (30 percent), closely followed by 46-65 year olds at 28 percent. This is in stark contrast to under 25s, with only one in 20 (5 percent) having smoked in that time period.
 
CIC stands for critical insurance cover, an optional extra that pays out a tax-free lump sum in the event of being diagnosed with a specified illness or medical condition during the term of your policy.

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