Giving up smoking is good for your wallet!
We were contacted by Mr T (a 51-year-old business manager) as he wanted to review his life insurance. He had given up smoking two years previously and had read that he could reduce the cost of his life insurance, or obtain a more comprehensive cover.
His existing life insurance was based on Smoker’s rates and provided £400,000 of cover, over a remaining term of 12 years for a monthly premium of £95.22.
Mr T is fit and healthy and decided to give up smoking because he was concerned about the long term health problems he could suffer in the future, not to mention the cost.
What insurers think of smoking
Smokers are more likely to claim on an insurance policy due to suffering an early death, or a critical illness.
As smokers statistically die younger, they are more likely to make early claims on their life insurance policies, so insurers charge them more to reflect the greater risk.
Non-smoker’s, or people who have given up smoking, have a reduced risk of claiming and this is therefore reflected in the premiums charged by insurers when compared to a smokers premium.
The rules are different for different insurers. However, if you have stopped smoking for longer than 12 months, and do not use any tobacco products such as e-cigarettes or nicotine replacement substitutes, we can help you to reduce your premium by switching you to non-smoking rates.
However, the rules are constantly changing, and some Insurance Providers could still charge more if an applicant has smoked within the last 5 years. We are happy to investigate which provider will offer you the most competitive premium.
We explained to Mr T that he could either keep the same level of cover but for a much lower premium. So the same policy on current non-smokers rates would cost him £50.82 per month.
Alternatively, he could keep the same premium, but increase the level of cover and the term. Mr T was happy to go along with this option as the monthly costs were already budgeted for.
Our client was very pleased that we arranged a level term life insurance policy with a sum assured of £400,000, over a longer-term of 19 years. This Included critical illness cover of £30,000, over the same term for a total monthly cost of £94.37.
Please note that any premiums mentioned are indicative only and based on this specific case study/ example, which is shown for information purposes only.
Whilst you are welcome to get a quote online, we would recommend you speak to one of our advisers.
Any quote that your adviser provides you with will take into account your circumstances and medical history, as well as your budget!
An online quote is just that – a quote – it isn’t a definite offer of cover. What really matters is the premium you are offered, after your application has been assessed.
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