Are you a chain smoker? Have you not been able to give up on this bad habit even after multiple attempts on quitting it? Then know that this bad habit of yours is affecting your life insurance policy as well! Smoking kills by causing cancer and lung diseases. And this is the reason that insurance companies always charge higher premium rates for smokers. If you are a regular smoker and are planning to buy term insurance plans to secure the future of your loved ones, this blog is a must-read for you. Let’s dive straight into the details without wasting anymore time!
Who Are Smokers? (As per insurance companies)
If you are appying for a term insurance policy and have smoked or consumed tobacco in any form within the last one year, then the insurance company will consider you as a smoker. The rate of premium for a smoker is almost 30% to 40% higher than that of a non-smoker. In case you hide the fact that you are a smoker in order to save on your premium rates, the insurance company has the right to accuse you of an insurance scam. Your policy will get nullified and you won’t get to enjoy any of the policy benefits.
Different Categories of Smokers defined by insurers
As per the insurance companies, there are generally three types of smokers:
- Preferred smokers: These smokers are considered to be physically fit as compared to the other two categories.
- Typical smokers: These smokers are said to have minor health issues.
- Table-rated smokers: These are the ones who suffer from severe health issues.
Major Features of Term Insurance Plans For Smokers
Below-mentioned are some of the major features offered by term insurance plan for smokers:
- The minimum tenure for a policy term ranges between 5 to 10 years.
- The maximum tenure for a policy term ranges between 30 to 40 years.
- The policyholder needs to be at least 18 years old to apply for term insurance.
- The maximum age of the term insurance applicant can be 75 years.
- In case the policyholder survives till the end of the policy term, he/she won’t be entitled to the maturity benefits. However, this norm varies from policy to policy. So, it is better to get in touch with the customer care executive to get the exact details.
- If the policyholder dies in the middle of the policy term, the nominee will be paid the sum assured.
- The policyholder needs to pay the premium on a yearly basis.
- Only the resident of India can avail this term insurance plan.
- The minimum amount for sum assured is INR 3 lakhs to 50 lakhs.
- There is no capping on the maximum limit for the sum assured.
Difference Between Term Insurance Plans For Smokers And Non-smokers
| Smoker | Non-smoker | |
| Rate of premium | Since smokers are vulnerable to health conditions and infections, the premium rates are higher than non-smokers. | A non-smoker pays relatively lower premium rates. |
| Life expectancy | Smokers have a poor life expectancy. | On the other hand, non-smokers have a higher life expectancy. |
| Information you need to share with your insurer | They need to inform the insurance company about their smoking habit. Otherwise, they may face severe issues like policy getting nullified, claims rejected and so on. | They need to share minute details regarding any health condition that they may be suffering from. |
| Special benefit | They have no capping on the maximum sum assured amount. | They can choose family floater plans to safeguard their family members as well. |
Why do smokers have to pay higher premiums as compared to non-smokers?
Smoking is extremely injurious to your health. It leads to severe chronic diseases such as lung cancer, mouth cancer, heart issues, bronchitis, and respiratory diseases. Thus, the life of a smoker is at greater risk as compared to that of a non-smoker. And hence, smokers have to pay higher premiums.
What If You Do Not Provide the correct information with your insurance company?
One should never keep away any fact from the insurance company. If you do not reveal about your smoking habit to cut down on your premium rates, then you may have to face severe consequences. Know that the insurance company will take your urine samples. And it gets increasingly difficult to hide its traces from your urine. In that case, the insurer can charge a fraud case on you. They will also terminate your policy.
Top Term Insurance Plans For Smokers
1. iTerm Plan from Aegon Religare:
This term insurance plan is designed keeping in mind the primary breadwinner of families. One can apply for the plan online as well.
Key Features:
- You can either pay the premium annually or do it in one go.
- The premiums that you have paid and the benefits that you enjoy from this plan comes under tax benefits.
- The minimum sum assured for this term insurance plan is INR 10 lakhs.
2. HDFC Life Click 2 Protect Plus Plan:
This comprehensive protection plan has been designed to offer financial stability to your loved ones in your absence. It allows you to choose different cover options as per your requirements.
Key Features:
- The term insurance plan is available online.
- It offers lump sum payment to the nominee in case the policyholder passed away in the middle of the policy term.
- The nominee will also be entitled to a monthly income for up to 10 years of death of the policyholder.
3. Bharti AXA Life eProtect Plan:
This term insurance plan is one of the most popular among the policyholders because of the low-cost premiums. One can apply for this plan online. And medical tests are also done at home for the applicants.
Key Features:
- The term plan comes with an additional advantage of the Family Care Benefit option.
- The minimum sum assured amount for this policy is INR 25 lakhs.
- Apart from the sum assured, the nominee also gets entitled to a monthly income upto 15 years of the demise of the policyholder.
Conclusion
If you are a smoker and have not yet got yourself a term insurance plan, take this as a sign and get yours as soon as possible. Make a well-informed choice and protect your family from the uncertainties of life.
