FREQUENTLY ASKED QUESTIONS

Life insurance companies have two separate health classifications based upon whether you are a smoker or not. Smokers in general pay more money than their nonsmoking counterparts. Smoking in the past meant that you would smoke tobacco cigarettes with leaf tobacco, which could lead to lung cancer down the road and ultimately cut your life short and increase the risk of the insurance company paying out a claim sooner. With time, as cigarettes become less popular, there is a new trend that has taken over among the youth as well as people who are trying to quit smoking, vaping and e-cigarettes.

Now, life insurance companies have had to incorporate vaping and e-cigarettes into the way that they determine life insurance rates for individuals. While vaping may seem harmless and as if it is a healthier alternative to smoking tobacco cigarettes, there is simply not enough information on the long term health effects of vaping, which puts life insurance providers in a tough spot. Health effects aside, life insurance companies are still cautious about how e-cigs are largely unregulated and could potentially be harmful down the road. Nearly every large insurance company classified e-cig users as smokers and ultimately plays a role in determination of rates.

While it is still up in the air as to if e-cigarettes are harmless or dangerous, life insurance companies are slow to adjust rates with the time. For right now, your premiums will more than likely be higher if you are a vaper or e-cig user.  Life insurance companies are also still unsure if people who vape are more likely to smoke leaf tobacco down the road, or lead unhealthier lives in general.  Until the mortality data proves otherwise, the insurance company will protect itself with higher premium rates.

How They Determine Your Life Insurance Classification

When you are applying for life insurance, you will go through a process that is referred to as underwriting, in which you will be given an insurance health classification. Life insurance classifications enable life insurance companies to be able to determine your premium rates by grouping people will a similar risk of dying into the same health rating. Insurance companies will usually take into account how healthy you are right now, your habits, and your family’s medical history when assigning a rating. The healthier you are and if your family has a fairly well medical history, then you will receive a better classification and lower premium rate. With rate classifications, they will rank like this if you are not a smoker:

  1. Preferred Plus
  2. Preferred
  3. Standard Plus
  4. Standard
  5. Substandard

Insurance companies all use similar classification systems, even if they call them different things and have multiple subcategories within each of the classifications.  Some insurance companies will call the best rating a “premier” rating for instance.

You may be an extremely healthy person, but using tobacco products can put you in a lower rate class all because you smoke. Insurance companies look at smoking as a hazard to your health and could lead to an early death down the road – which is why your premiums will be higher. Many life insurance companies will ask you to take a paramedical exam, in which you will have to give a urine sample that will reveal any drugs or nicotine that may be within your body, which is why it is important to not lie about if you are using nicotine or are smoking. For smokers, the risk of dying is so much higher that they classify you separately from nonsmokers.  The classification of your rate will then be categorized as “Preferred Smoker” or “Preferred Tobacco” as opposed to “Preferred Nonsmoker” classification that you could otherwise get. If you smoke, you will never get the best rates.

Vaping Considered Smoking for Insurance Purposes

Whether you believe that vaping is better for you than smoking, insurance companies will still charge you a considerably higher rate in order to obtain life insurance. As mentioned earlier, this is Vapingdue to the lack of research and understanding of long-term effects of using e-cigarettes, in which life insurance companies do not want to take a chance on nonsmoker prices for people who vape. Life insurance classify e-cigs as a tobacco device, even when e-juice does not contain any tobacco. While these are not the same as cigarettes, they could still have the same effects down the road, in which your life insurance company will classify you as a smoker.

What about Marijuana?

For the purposes of a health insurance rating, insurance companies view marijuana smokers the same way that they view tobacco smokers, even if you “vape” your marijuana.  Unfortunately, vaping or smoking THC or marijuana based compounds will lead to more expensive life insurance even if you are otherwise healthy and the rate of use is infrequent.  Beware, most insurance companies will test for THC during the medical exam.

What if you Quit?

Many insurance companies will need to see that you are tobacco and nicotine-free for a period of time (usually a year to five years) because they will offer you a more beneficial classification. Also, if you started out as a vaper when you purchased your policy and decided to quit while your policy was in force, then you may qualify for a better rate down the road. Once you have been around a year of refraining from tobacco products, then speak with your insurer about receiving a lower rate. Your insurer may allow you to move from a smoker classification to a nonsmoker classification and ultimately put you in a different rate class.

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