Smoking can have a significant impact on your health and your wallet. Generally, non-smokers enjoy fewer medical complications and far lower premiums, making coverage more affordable. But what if you start smoking after getting life insurance, or if you don’t smoke but use nicotine products? Your nicotine consumption may still affect your premiums and non-disclosure can have serious consequences.
It’s important to clarify how your provider will consider your tobacco and cannabis use, as this will affect the cost of your life insurance. Learn more about smoking and life insurance rates, who’s considered a smoker by insurance companies, and how smoking cannabis affects your premiums versus smoking tobacco.
What Do I Do if I Started Smoking After I Got Life Insurance?
If you started smoking after getting life insurance, it’s best to disclose it to your life insurer. Smoking has negative health effects that increase the risk of providing coverage, which is why smokers have higher insurance premiums than non-smokers.
For those who have term insurance policies, disclosing their new smoking habit will be mandatory for policy renewal. Additionally, failure to disclose that you now smoke can cause your policy to be voided, whether it’s a term life insurance or a permanent life insurance policy.
If it’s shown later on that undisclosed smoking may have contributed to your cause of death, your insurer may delay your beneficiaries’ claim or reduce the payout. Worse, they may consider it fraud or misrepresentation and deny the claim altogether. Avoid these complications by talking to your life insurer and asking how smoking will affect your current policy.
Who is Considered a Smoker by Insurance Companies?
Canadian insurance companies generally consider the following people as “smokers” when determining life insurance quotes:
- People who smoke cigarettes, cigars, cigarillos, and pipes
- Individuals who use chewing tobacco
- Those who use e-cigarettes and vaping products
- Anyone who’s used nicotine products for smoking cessation, such as patches or gum
Even “social smokers” (a.k.a. those who only smoke in certain social contexts) or use nicotine gum or patches are considered smokers. This is because when assessing your health risk and status as a smoker or non-smoker, your life insurer may ask you to undergo a medical test to measure your nicotine levels. For insurance purposes, it’s not how you consume it that matters so much as the amount of nicotine in your body.
Smoking Tobacco vs Smoking Cannabis: How it Impacts Your Rates
Since marijuana’s legalization in Canada in 2018, Canadians have wondered if smoking cannabis has the same impact on life insurance rates as smoking tobacco. Here’s a quick comparison to help show how the use of each affects your premiums:
| Factors | Tobacco smoking | Cannabis smoking |
|---|---|---|
| Effect on insurance premiums | Any use can increase your premiums by 50% to 100%, depending on the insurance company. | Occasional use may result in non-smoker rates. More frequent use may result in higher smoker rates or denial of your application unless it’s for medical purposes. |
| Disclosure requirement | All tobacco and nicotine use should be disclosed regardless of frequency. Lying about use is considered fraud. | Frequency of use should be disclosed. Medical use may be assessed differently. |
| Underwriting | Companies typically require nicotine testing, and any use of nicotine products such as gum and vapes is considered smoking. | Use is assessed on a case-to-case basis, such as recreational versus medical purposes and the method of consumption. Heavy use (typically more than four times a week) may be considered “smoking”. |
Cannabis users used to be charged smoker premiums, but in recent years, insurance companies have started to look at cannabis on a case-to-case basis. While any tobacco or nicotine use is still considered “smoking” by life insurers, many insurers now offer occasional cannabis users the same quote as a non-smoker.
Note that different insurers will have different underwriting processes, and some may offer lower quotes for the same frequency and purpose of usage. For example, heavy cannabis usage (e.g. smoking cannabis more than thrice a week) may result in the same premiums as tobacco smokers.
What Happens if You Lie About Smoking on a Life Insurance Application?
Lying about smoking on your life insurance application is considered fraud by insurers and can cause your application to be denied. If you’re caught lying after the application has been approved, the policy may be considered void so you won’t get any coverage or benefits.
Canadian insurers can check the Medical Information Bureau to track data from previous life or health insurance applications, so lying can also impact future insurability. Other insurers may see in the records that you lied about your smoking, which may result in coverage limits, higher quotes, or even outright denial of your new applications.
If you’re concerned that disclosing your usage may make it difficult to get coverage, consider getting simplified or guaranteed life insurance. Simplified life insurance only requires a basic health-related questionnaire, while guaranteed life insurance doesn’t require a questionnaire or medical exam. These alternatives are more expensive than traditional life insurance, but they’re convenient for high-risk individuals to get coverage and financial security for their loved ones.
Key Advice from MyChoice
- Always disclose your tobacco and cannabis use truthfully to your insurer, as lying on your life insurance application can lead to immediate policy cancellation and denial of your claim.
- To be considered a non-smoker for life insurance purposes, an individual typically has to be free of any traces of nicotine for at least 12 months. The minimum period may vary between insurers, so check with your provider how much time has passed since you quit and what tests you’ll have to undergo to be considered a non-smoker and get lower rates.
- Getting lower premiums after quitting smoking will depend on factors such as health complications you’ve developed due to smoking and how long you’ve been nicotine-free. This is because it can take time for your health risks to drop to the same levels as a non-smoker.