Cigarettes have garnered a bad reputation for themselves, and several slogans have been dedicated to encouraging giving them up. Aside from being harmful to your health, smokers also have to shell out a higher amount for term insurance compared to their non-smoking counterparts.
A term plan costs higher for smokers as they have a greater risk of untimely death. Therefore, when smokers buy term insurance, they have to pay a higher term insurance premium as compared to non-smokers. However, owing to the higher health risk associated with smoking, be it respiratory illnesses, cancer, and overall poor quality of life, smokers need to have term insurance. A term plan ensures the financial stability of your family even in your absence.
Benefits of Term Insurance for Smokers
Smokers are often discouraged from seeking insurance as they believe that either they will be denied an insurance cover or that the term insurance premium will be unaffordable. However, neither of these is true. A term plan for smokers is denied only in extreme cases with obvious health complications that arise from indulgence in heavy smoking. Insurance providers ask smokers to disclose the frequency of smoking and the number of cigarettes used. Additionally, while the term insurance premium is higher for smokers, it is still highly affordable if you take into account the cover it offers.
Considering a more hopeful prospect, it is possible to be treated as a non-smoker if you have kicked the habit for a few years. Here are some term insurance benefits that can relieve the financial stress of your family in your absence:
· Amongst the most important term insurance benefit is that it offers high coverage at affordable premiums. Even if you are a smoker, the term insurance premium is significantly low compared to the cover it offers.
· If you quit smoking after purchasing your term plan, your premium amount gets recalculated at the time of policy renewal, and the insurance provider may cut the premium amount depending on the time passed since you last smoked.[PP1] [Bh2]
· It can pay for your outstanding financial liabilities in the unfortunate event of your untimely demise.
· When you buy term insurance early in life, you can save more. This saving can be optimised with an online term life insurance policy.
· The best term insurance acknowledges and respects your lifestyle choices to offer you complete protection.
· When you smoke, you might be worried about the financial protection of your loved ones, should something happen to you. Term life insurance puts this worry at ease and offers you peace of mind.
· Finally, you can avail yourself of the tax benefits on the premiums paid for your term life insurance policy. Even the sum assured is completely exempt from taxes.
How are Smokers Defined by Insurance Providers?
Most insurance companies have pre-defined categories to classify smokers. These are as follows:
· Preferred smoker: An individual who, aside from his smoking habit, is otherwise fit, belongs to this category. The premium amount under this category is the least as compared to the other two.
· Typical smoker: If an individual has a minor lingering health issue along with their smoking habit, fits under this category. The premium amount here is slightly higher.
· Table-rated smoker: Individuals who have a notable health condition owing to their smoking belong under this classification. This category has the highest premium amount amongst all three.
As insurance companies look to minimise their risks, smokers generally pay a higher premium amount for their term life insurance.
Term insurance providers do not differentiate between the type of nicotine that insurers use and whether they are frequent or occasional smokers. Any individual who uses tobacco or nicotine in any form, be it cigarettes, cigars, gutkha, beedi, khaini, flavoured pan masala, nicotine patch or nicotine chewing gum, is categorised as a smoker. Insurance companies determine this by asking questions about the smoking habits of insurance seekers, and so, if you consume tobacco or nicotine products, if you have used tobacco in the past four years, or if you have ever consumed a tobacco product, you are considered as a smoker.
Why Should You be Transparent in Disclosing Your Habit?
To avail yourself of the term insurance benefits, it is always advisable to disclose all the relevant information to your insurance provider when you buy term insurance. Non-compliance to this rule is treated as insurance fraud and can jeopardise your claim settlement. Your term insurance can be considered null and void, putting the financial future of your family at risk. As insurance providers are stringent with their investigation, you must reveal your smoking habits to ensure a seamless claim settlement.
Regardless of whether you smoke, having term insurance plays an important role in your financial planning. Edelweiss Tokio term insurance plan Zindagi Plus comes with a host of benefits to ensure the financial security of your loved ones even in your absence. Some of its unique features include:
· The Better Half Benefit for an additional cover of up to 50% for your spouse
· Life + COVID-19 cover to protect you from unforeseeable circumstances.
· No medical option for a sum assured of up to ₹99,99,000
· Discount on the premium amount when you opt for a higher sum assured.
In addition to the aforementioned, Edelweiss Tokio is experienced in extending the love and care you bestow on your family on your behalf. Moreover, we have curated unique plans that can help you grow your wealth while also protecting your family’s future. Finally, as a customer-centric brand, Edelweiss Tokio constantly innovates to cater to the changing needs of the insurance seeker.
One of the biggest myths associated with personal finance is that smokers cannot avail themselves of an insurance cover. On the contrary, insurance providers can help smokers with finding the right cover with slightly different terms and a higher premium amount. However, this should not discourage smokers from purchasing insurance as they are more prone to lifestyle diseases. Considering this, finding the right insurance cover is essential as it promises the financial protection of your family even in your absence.
Siddhant Dubey - Writer & Photographer
Siddhant works as a freelance content writer who is interested in a wide range of spheres from photography and personal finance to cooking. He is also an aspiring photographer striving to showcase life around him through his vision.