`

Young people stub out smoking as new statistics reveal smokers shell out up to 65% more for life insurance

Smokers are paying hundreds of pounds more for their life insurance and newly released figures reveal exactly how much.
Smokers are paying hundreds of pounds more for their life insurance and newly released figures reveal exactly how much.
Share this article

New research has revealed that smokers cough up to 65% more for life insurance.


Lighting up and even smoking on e-cigarette can cost an extra £26 a month.

The shock figure has certainly hit home for young people who are ditching their "fags" with only one in 20 smoking in the last 12 months.

New analysis of internal data by MoneySuperMarket reveals that in cash terms it can cost a smoker an extra £312.84 each year for insurance.

The health risks that come from smoking are undeniable, which is why premiums are higher.

But life insurance is an essential purchase for anyone with dependants, especially if they have a mortgage, which is a compelling financial reason why smokers should seriously consider ditching the habit.

Analysing quoted premiums for life insurance policies between January and April 2018, it was found that, on average:

* Smokers pay £26.07 more for decreasing term insurance with critical illness cover (CIC) included

* Smokers pay £16.59 more for level term cover with critical illness cover included – 48 per cent more than non-smokers.

With decreasing term insurance, the amount the policy would pay out falls over its duration, the idea being that this sum reduces in line with an outstanding mortgage debt that is being repaid with a capital and interest loan.

This helps cut the premiums compared to level term insurance.

The amount that would be paid out by a level term insurance policy remains the same for its duration. This more expensive option is useful for those who want to provide additional money to clear other debts and to provide funds for dependants’ living costs.

With their long-term effects on health yet to be agreed, e-cigarettes are viewed in the same way as normal cigarettes for life insurance purposes.

It is also worth bearing in mind that insurers don’t distinguish between daily, occasional or social smokers – if you’ve smoked in the past 12 months, you could end up paying more.

According to MoneySuperMarket , the highest proportion of people who have smoked within the last 12 months are aged between 36-45 (30 per cent), closely followed by 46-65 at 28 per cent. This is in stark contrast to under 25s, with only one in 20 having smoked in that time period (5%).

Aside from existing health conditions and whether the applicant smokes, age is a clear factor that affects the cost of life insurance.

Analysis shows that monthly premiums skyrocket when taking out a policy over the age of 45 – as much as double the average price.

Kevin Pratt, consumer affairs expert at MoneySuperMarket, said: “No one likes to think about their own premature death, but anyone with dependants needs to plan for the worst.

"Life insurance is there to provide financial support by clearing outstanding debts and, with some policies, providing funds to meet living expenses.

"The impact on families where no cover is in place can be devastating.

“Clearly, paying for something you need but hope never to use is frustrating, which is why it makes sense to give up tobacco and hopefully cut the cost of your premiums.

"Even if you’ve already got life insurance, it’s worth giving up and seeing if you can negotiate a lower premium with your insurer or get a new, cheaper policy elsewhere.

“You’ll also improve your health, which has to be a bonus.”

For British homeowners to find out what life insurance policy is best for them, MoneySuperMarkethas launched a range of new guides with tips on how to save money when searching for a policy.

MoneySuperMarket’s also has a stop smoking page which can be found at https://www.moneysupermarket.com/life-insurance/stop-smoking/