Smokers Could Save up to €60,000 in Life Insurance if They Quit

Experts at the insurance agency point out that sadly, many policyholders are unaware of the significant savings on insurance policies they could avail from if they had to quit smoking, which could be reduced to over 50%.

“When weighing up the advantages of quitting smoking, we generally think about the obvious health benefits and the cost savings to be gained from not purchasing cigarettes frequently – especially given that, from 2021, one packet is set to cost €14,” said Michele Murphy of Royal London.

“However, fewer people may immediately think of the significant cost benefit of quitting in terms of the impact it has on life cover premiums. As you might imagine, smokers pay more in premiums for life insurance than non-smokers, due to many damaging health effects, but people may not be aware of just how sizeable the difference can be between the premiums charged,” she added.

The gap between smokers and non-smokers grows as they age
Discussing a cost analysis carried out by Royal London, Murphy pointed out the price increments that smokers are subjected to as they age. “The figures speak for themselves – showing massive savings for non-smokers when compared with smokers. A smoker turning 35 on their next birthday will pay over €6,000 more in premiums than their non-smoking counterpart for €300,000 worth of Level Term Life Cover over a 25-year term.”

“A smoker turning 45 on their next birthday can expect to pay over €68,300 more than a non-smoker during the course of a Specified Serious Illness policy for €300,000 over a 25-year term. Our experience is that while many people expect that smokers will pay more in premiums; they are surprised how much the cost savings can add up to over the lifetime of the cover.”

Vaping products considered tobacco products
In order to be classified as a non-smoker one would have to prove that they have been abstinent from any tobacco products for the last 12 months. These sadly include safer alternatives such as e-cigarettes, and one’s insurance provider may even ask for a cotinine test (smoker test), which is done by screening a urine or saliva sample.

Murphy concluded by pointing out that thanks to the current pandemic, more people have become more health conscious. “Given the pandemic, more focus than ever has been on our physical health, and with tobacco use being the leading cause of preventable death in Ireland each year, it stands to reason that those that smoke may make giving up the habit a priority in 2021. Fortunately, the prevalence of smoking in Ireland is decreasing – according to HSE figures for the first half of 2020 15.7% of the Irish population smoke, which is down from the 2019 full year figure of 17.1%.”

“We are calling on ex-smokers who have successfully kicked the habit since at least 01 January 2020 to go about reaping the financial rewards of their outstanding achievement. If you are a smoker, who is considering quitting, the potential cost savings on your life insurance is another reason to break the habit that you can add to the list.”

“If you’re an ex-smoker since this time last year, we recommend that you get in touch with your Financial Broker who, by assessing your individual needs, will be able to advise you about the potential cost savings for non-smokers. It may be possible for you to avail of cheaper rates and start saving money on your insurance policy,” she concluded.