A perfectly healthy person who smokes can expect to pay, best case, twice as much as a person who doesn’t smoke for life insurance. I’ve been on that soap box often enough that I don’t know that I need to beat it to death anymore.
With that being said, there are other times when smoking can have an even more profound impact on underwriting. An underwriter I know and work with on a regular basis calls the extra premium or sometimes the decline that results from smoking in addition to certain health issues as a “you just can’t fix stupid tax”.
We’ll start with the flagrant examples and work our way back toward some of the more subtle. By the way, all of these examples are from people who have actually called me attempting to get life insurance. A person who has diagnosed COPD (chronic obstructive pulmonary disease) and still smokes has apparently missed something somewhere and is a slam dunk decline.
A person with an otherwise insurable history of cancer, if they smoke, would either suffer a much higher rating or be declined because they haven’t quite grasped the fact that there is a direct correlation between abusing your body and bad things happening.
One that comes up fairly frequently is the person who has suffered a heart attack or been diagnosed with CAD (coronary artery disease) and still smokes. Hellooo!!!! The doctor said you need to quit. Your wife said you need to quit. The surgeon general said you need to quit. Your mother is going to outlive you because you refuse to get a grip and do the right thing.
Asthma and smoking. Depending on the severity of the asthma, this can be reasonably insurable to highly rated. It’s frankly never made a lot of sense to me. If you have trouble just breathing air, why would you substitute smoke for air? Kind of like if you had trouble swallowing water, substituting mud.
Bottom line. Life insurance underwriting allows for insuring smokers in most cases. Higher rates will always apply when comparing smokers to non smokers. I’ve never been shy about ripping the heads off underwriters when I think they’ve got it wrong. When it comes to smoking combined with smoking caused or exacerbated health issues, I believe they’re right on target.
My 20 years of experience give me the knowledge and leverage to find reasonably-priced life insurance for people who have been declined or are paying more than they need to.
ou can believe the
You can believe the (ex)Surgeon General if you wish, but I say he’sa bald faced liar and I can prove it with common sense alone.
If insurance writers think it’s their mission to coerce smokers into quitting I’ll do without life insurance. Smokers, unite!
Boycott!
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Joe Camel,
You can believe or not believe all the scientific data that both sides put out but it is hard to ignore a hundred years worth of mortality data. Insurers charge those higher rates to smokers, not because the surgeon general tells them too, but because the smokers the insurance companies have written policies to over time have actually died that much sooner.
Just like auto insurance companies don’t charge teenagers higher rates because studies show they are worse drivers or that everyone agrees they are worse drivers. They charge them higher rates because teenagers have produced higher claims over the years.
You can argue whether or not smoking increases the change of X disease by Y% all you want, but in the end the life insurance data shows that on average smokers die sooner than nonsmokers.
Well we won”t be doing business with life insurance companies anyway– I’ll put my premium in the bank.
If smoking is the only criterion used by insurance companies when they say smokers die sooner they are misleading the public. What else is new?
Animal studies done way back in the fifties proved smoking is not unhealthy–unimpeacheably, incontrovertibly and commonsensically. So your policy is fraudulent.
I once had an auto insurance company raise my rates–no accidents–because some legal hustlers were milking the no fault law. So insurance premiums are not strictly by the numbers.
Question: If smokers’ premiums are double,does that mean
they live half as long?
Joe,
Interesting logic. You’ll show the insurance companies by boycotting them. You’ll get even with them by not protecting your family.
Just so you don’t think life insurance companies are just “anti smoking”, let’s throw a different face on it. Say for a minute that you are a perfectly healthy 45 year smoker. Do you believe that you should pay the same for life insurance as a 45 year old who drinks abusively? How about a 45 year old who works as a civilian contractor in Iraq? How about a 45 year old whose father and three older brothers all suffered heart attacks prior to age 50?
Life insurance is discriminatory by its’ very nature. It has to be. Each person presents a different risk factor and they should all be measured on their own merit.
Obviously you think that smoking doesn’t present any risk and it’s OK for you to have that opinion. Just don’t expect insurance companies to jump on board.
As to your question. Mortality assumptions aren’t as simple as you want them to be for your argument. If an insurance company only thought you would live half as long as a comparable non smoker, they wouldn’t offer you coverage at all. The extra premium simply reflects the proven extra risk.
I say paying double for smoking is a raw deal with a social engineering purpose. Putting that double premium in the bank is my way of protecting my family. If I don’t get clobbered by a New Yorker stepping on the gas when the light turns red they’ll be a lot richer one day. I can guarantee I will not croak from smoking because nobody does.
If insurance hustlers are so smart about risk maybe they can help me with the lottery. I’ll split the winnings.
In a perfect world insurance would be the province of the government with the same premium for all like Medicare.
Now you can opine as to what an idiot I am but my money is in my pocket for a better purpose than making hustlers rich.
Well Joe,
You are certainly not without an opinion. Best of luck with that savings account. I hope for you and your family it works.
Ed, I agree with you regarding how insurance companies handle the risks associated with smoking, and their underwriting guidelines related to those risks.
And, yes, each individual situation may be different, and there may be insurers who are willing to insure some occassional smokers at more reasonable rates. But, I know first-hand from some family members, that you may smoke more than a pack-a-day for over 50 years and still have clear lungs on your annual check-up.
So, maybe genetics, environment, and stress should play a role in determining smokers rates as well. If they don’t already. I think some smokers do live longer than others who may have more stress in their lives, or be overweight, or don’t exercise, or have poor genetics for longevity.
I guess what I’m trying to say is that much more research should be done on smoking and life insurance, and more factors be given weight in determining life insurance rates.
There could be many more categories for rates created by life insurers to really provide more competitive premiums for smokers based on individual niches realted to genetics, smoking habits, age, weight, and all demographics that may factor into lung cancer – such as occupation, living in a densely populated city with air pollution, etc.
Just some things to think about for those life insurance underwriters out there who develop the guidelines and rates for smokers life insurance.
I understand what you’re saying, but what you’re proposing would make underwriting more complicated than it needs to be. Remember that this is about mortality experience. Overall smoker experience more health issues and have a shorter life span than non smokers. Sure, some live longer. Some of it is genetics, some lifestyle, some just luck.
But to add a whole new list of weighting factors to the underwriting guidelines for smokers begs the underwriter to do the same for non smokers.
I believe living in Denver as opposed to a small mountain community like I live in must have an impact on mortality. It is far more stressful. But where do you cut if off. Do you charge more if the city is more than a million people, or do you use air quality standards, murder rates, road rage incidences.
Basic underwriting as it stands today may have some flaws, but it is generally on the right track.