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Many companies offer Life insurance to smokers. Even though choices are aplenty, it is not easy for smokers to get exceptionally good coverage from insurance companies due to the inherent risks associated with smoking.
The type of coverage given depends on many factors. For example, smoking pipes, cigars, cigarettes or chewing tobacco have different rates of life insurance. This is based on the risk estimates calculated according to the tobacco product consumed.
Rates also depend to a large extent on the number of years the person has been smoking. If the person has quit smoking, the number of tobacco free years also has an effect on the insurance rates.
Typically though, the premium rates for smokers are always greater than for a matching non-smoker. Smoker life insurance premiums are often more than three times the amount paid in non-smoker premiums. This is because smoking causes 87 percent of lung cancers, which kill more people than breast, prostate and colon cancers combined.
In life insurance there are three different premium classifications - standard, preferred or preferred plus. In the preferred and preferred plus types, the person maybe required to be free of tobacco usage in any form for the past 1 year and 5 or 6 years respectively by most companies. Preferred and preferred plus also require the person seeking insurance to be healthy and the person should not be suffering from any cardiovascular disease or diabetes. In the standard type, the person is required to be free from tobacco usage for the past one year. In this type some health impairments are allowed. Persons having a personal history of cardiovascular disease or diabetes may be considered.
An analysis done by BudgetLife, an online life insurance rates calculator has found the top smoker insurance companies in the United States. It considered $500,000 of ten and twenty year term life insurance for male and female, standard and preferred-plus underwriting, for ages 25, 35, 45, and 55.
Western Reserve Life Assurance Company of OH is at the top spot and has retained their lead from the previous year. The second and third best were Ohio national Life Assurance Corporation and the AXA Equitable Life Assurance Company respectively. The companies rank differently for males and females.
Not all life insurance companies use the same underwriting criteria to determine whether or not the person seeking insurance would fall into one of their smoker classifications. Most companies classify a person as a smoker if he or she states that they have been using tobacco in any form in the past year. Other companies use a longer duration criteria and only those who have been using tobacco in any form for the past two or three years are considered smokers. Some companies also seek information about any form of tobacco usage in the past five to ten years. They use this information to understand whether the person seeking insurance can be classified in the non - smoker category.
This article was contributed by Prerna Mordani.
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