Do Smoking and Drinking Increase My Life Insurance Premium Price?
There has been a fair share of the adult population that either consumes alcohol or smokes cigarettes. The health risks that both of these activities bring along with them are widely known by all, but many of the adults have either accepted them or rationalized them. However, insurance providers, that hold quite the financial interest in our lives, have not. And therefore, they tend to penalize you for these unhealthy habits by reflecting this in the life insurance price (i.e. higher life insurance premium price).
Regardless of how you approach your thought process while you pour a drink or light a cigarette, both smoking and heavy drinking tend to expose you to a higher risk of serious health issues, including heart attacks, cancers, and strokes. They tend to increase the likelihood of an early demise which means your insurance provider will have to pay out a large sum assured. To offset this risk, Life insurance companies tend to increase your life insurance Policy premium price.
Here is a guide to address various questions that might come to your mind such as:
- “By how much will my life insurance price rise because of smoking?”
- “How much alcohol consumption should I report to my insurance company?”
- “Can quitting any of these habits lead to saving on my life insurance premium price?”
Read on to have a closer look at the impact of these habits on your life insurance costs.
Impact of Drinking on Life Insurance Price
While you must have read all over the internet how a once-a-while or even daily glass of red wine can be beneficial for your health, there are scientific agreements that excessive alcohol consumption can have a risk to your health, both in the short run and the long run. This is the reason why your doctor tends to enquire about your weekly intake of alcohol. And, your insurance provider is entitled to do the same, as part of your insurance application, and misleading your underwriters about your alcohol consumption can lead to future consequences such as rejection of your claims.
However, at the same time, you do not need to rush down to your insurance provider to inform about the festive celebration you might have had. Splashing out for a week’s time on a holiday will not lead to a rise in your life insurance Policy premium price. Similarly completely going off alcohol won’t necessarily get you a discount on your premiums. Generally, occasional drinking will not lead to any such noticeable impact on your life insurance price.
Make Sure to Fill Correct Information on Your Form
You must be certain about calculating the amount of alcohol you consume depending on the guidelines laid out by the government. It is possible that upon running the math, you might discover that all social drinking also adds up to some seriously unhealthy habit. This habit might be contradictory to what your insurance provider might be aware of and might be compromising the life insurance price that you are paying every month.
It is possible for the insurance providers to run a check to see if you have intentionally or unintentionally misrepresented your consumption of alcohol. Payouts can be slashed or claims can be rejected after the demise if the provider thinks that they have been misled in terms of the policyholder’s drinking habits. It can be a difficult spot if your insurance provider finds out otherwise than anything stated as all your premiums paid over the course of time to support your family will go to waste.
If you have ever in the past received any treatment for any alcohol-related issues or alcoholism, it is possible for you to face problems while finding an insurance provider. Some insurance companies might question you regarding alcohol-related driving offenses and once again, if you fail to disclose these you can face cancellation of your policy.
Additionally, make sure to keep in mind that some of the insurance providers will not provide you any payout if your demise is caused due to misuse of alcohol, such as a drunken collision.
Impact of Smoking on Life Insurance Premium Price
The life insurance premium price for a smoker can be almost double than of a non-smoker that is of the same age. There are statistics to back up the insurance providers for this higher life insurance price, showing that smokers have a higher chance of making claims on their policies because smoking exposes them to a higher risk of diseases and demise.
And unlike with consumption of alcohol, wherein the occasional consumption and special events won’t have any impact on your premiums, just the ‘once in a while’ cigarette can put you in the category of a smoker. If you are one of those that light up on the weekends or while socializing or likes to indulge in celebrations with a casual cigar, your insurer will refer to you as a smoker.
Again, it is not ideal to hide any information and mislead your insurance provider, as it can lead to your policy’s termination at any point and rejection of any claims. It is possible for your insurance provider to, during your life, get a test to see if you smoke. After your demise, your insurance provider can also investigate the claims made, and are more likely to resort to this if demise is caused by any smoking-related illness, say, lung cancer. If they come to know that you had been covertly smoking while enjoying a lower life insurance premium price, the payout for your family can be slashed down or even rejected entirely.
The good news, however, remains that you can reduce both your health risks and your life insurance price by quitting this habit of smoking. Insurers generally consider you as a non-smoker if you have left smoking successfully for a period of 12-18 months. And, you might not even have to wait to obtain a policy till you’re smoking-free, you can find out if your insurance provider allows you to update your policy and adjust the life insurance premium price if you can later prove you have been nicotine-free for the time period required.