Your Client’s Life Insurance Could go up in Smoke!

Are you a smoker? What does that question really mean? Nearly 40 million US adults, about 15%, still smoke cigarettes. Every day, more than 3800 youths under the age of 18 smoke their first cigarettes, despite the health warnings! And, according to the CDC, tobacco kills up to half of its users. Tobacco kills more than 7 million people each year. More than 6 million of these deaths are the result of direct tobacco use while around 890,000 are the result of non-smokers being exposed to second-hand smoke! No wonder insurance companies are concerned with cigarette smokers.

There is a bright spot here. Half a century ago, more than two in every five adults were smokers. It has fallen steadily over time. It has fallen even more sharply among 18 to 24 year olds. This is good news.

But should the question you ask your client when speaking with them about their life insurance needs be, “Do you smoke cigarettes?” What about:

  • Cigars
  • Pipes
  • Chewing tobacco
  • Hookahs
  • Electronic cigarettes
  • Snuff
  • Dissolvable nicotine products
  • Marijuana
  • Nicotine patches and gum

Each of these products have health risks and in the life insurance business, that means your clients can expect the carrier to charge them more. This being said, each carrier may charge different rates for different forms of tobacco. For instance, a “celebratory cigar” may be ok with some carriers, while not with others. Dippers and chewers may also be able to get non-tobacco rates with some carriers. One of the keys here is to ask the right questions. Not “Do you smoke cigarettes?” but “Do you use any form of tobacco or nicotine?” the latter encompassing all of the products available that can affect your client’s life insurance rates. “How much of a difference?” you might ask. Well let’s take a look. Here is an example for a healthy male age 45 and the differences in cost for a $500,000 20 year level premium term benefit plan.

  • Preferred Non-tobacco –   $689.99 annually
  • Preferred Cigarette Smoker – $2438.99 annually (amazing, isn’t it?)
  • Healthy chewers can be Standard Plus Non-tobacco with some carriers – $1,010.00

The price difference is just staggering. So, what you don’t want to have happen is to ask the wrong question when it comes to tobacco use. You want to make sure you are quoting the correct premiums before your client goes through the underwriting process and the carrier comes back with a cost that your client cannot afford.

Something to keep in mind is that IF your client does stop smoking or using other forms of tobacco products and it is documented with their physician, after a period of typically 1 year, the insured can go back to the carrier for reconsideration to have the tobacco use taken off and non-tobacco rates applied.

So…what’s in a question? A lot when it comes to the cost of life insurance for your tobacco using clients. Ask the right question; set proper expectations; have a happy client.

If you would like to learn more about how tobacco use affects life insurance premiums, feel free to contact me at