31-05-2025
Do You Smoke? It Might Be Making Your Term & Health Insurance More Expensive
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Insurers usually classify someone as a smoker if they've consumed any form of tobacco—including cigarettes, cigars, beedis, or chewing tobacco—within the past 12 months.
World No Tobacco Day: World No Tobacco Day is celebrated every year on May 31, as a stark reminder of the dire consequences of consuming tobacco not only in our health but also on our wallets too. According to Global Adult Tobacco Survey 2016-17, 28.6 per of adults aged 15 and above use tobacco in any form. The survey states that every tenth adult smokes tobacco in India.
Little did we know that smoking also directly affects our wallets, especially when it comes to buying insurance policies. Be it term or health insurance, smokers often end up paying significantly higher premiums than non-smokers.
Term Insurance: Twice the Price For Smokers
According to Varun Agarwal, Head of Term Insurance at Policybazaar, smokers may pay 80% to 100% higher premiums on their term insurance policies. The reason is simple—tobacco use greatly increases the risk of fatal diseases like cancer, heart conditions, and chronic respiratory issues. These health risks make smokers a high-risk group for insurers, translating into higher premiums.
Smokers normally pay between 20% and 50% more in premiums than non-smokers, depending on the company and the overall health profile of the company and the overall health profile of the person, explained Chetan Vasudeva, Senior Vice President – Business Development at
How Is Being Smoker Classified?
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Varun Agarwal explains that insurers usually classify someone as a smoker if they've consumed any form of tobacco—including cigarettes, cigars, beedis, or chewing tobacco—within the past 12 months. 'This classification is based on both self-declaration and medical evaluation," he adds.
'Non-disclosure or misrepresentation may result in rejection of claims or even cancellation of the policy," Vasudeva warned.
What If You Quit Smoking Later Part Of Life After Buying Term Insurance?
Unfortunately, it doesn't change much. 'Once your term life insurance policy is issued with a 'smoker' classification, the premium is locked in for the entire term," Agarwal said. In other words, quitting after purchase won't reduce your premium.
The good news is there is no waiting period for tobacco-related illnesses in term insurance once the policy is active.
Health Insurance: Higher Costs And Waiting Periods
There's a bit more flexibility in health insurance. If a smoker stays tobacco-free for 12 to 24 months and can provide medical proof, some insurers may reclassify them as a non-smoker during renewal, potentially lowering the premium. But this isn't guaranteed and depends on the insurer's policies, explains Chetan Vasudeva.
However, a waiting period of 2 to 4 years is usually applied for tobacco-related illnesses such as lung cancer or COPD, especially if the condition existed before policy issuance.
Disclaimer: The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.
About the Author
Varun Yadav
First Published:
May 31, 2025, 12:57 IST
