Even the most basic term life insurance policy wants to know if you light up. They don’t need a medical exam, they don’t want to see your records, and they may not even really care where you live. What life insurance companies are interested in boils down to a very few things:

1. Your age,
2. Your gender,
3. Your height and weight, and
4. Whether or not you smoke.

Now, there are, arguably, three of those factors that you really can’t control completely. Yes, you can lose weight, but you can’t become taller, change your age or change your gender (at least, not on a chromosomal level. For the insurance company, that’s what matters because it indicates genetic predisposition to disease as well as life expectancy).

Smoking, though, you can control. Smoking is, of course, a huge health risk, and you can improve your health by quitting. Everyone who’s lit up in the past three decades knows this.

So, life insurance companies hedge their bets. They charge higher premiums for smokers than for non-smokers. They do so because smokers carry a greater risk of dying while the policy is in effect. If you have fewer health risks, the life insurance company is less likely to have to pay out during your term, which is how these companies make money.

Life insurance policies for smokers can be as much as three times as high as they are for non-smokers. That means that the life insurance company assumes that three times as many smokers will die during their policy term than non-smokers.

The life insurance companies classify people into several different categories when it comes to smoking. Here are some of the common ones:

• Overall good health and haven’t smoked in five years or more. You’re the easiest kind of customer to handle, and your chances of dying during your policy term are slim. You pay lower premiums and get peace of mind, and the company gets less risk.
• Overall good health and haven’t used tobacco in three years. While you’re not quite as desired as those in the category above, you are also in a preferred category and get a decent rate.
• Good health and haven’t smoked in over a year. This one will get you the standard rate.
• Smoker. You’re a risk to the company, and the premium rates they charge show it.

Finally, you need to realize that, if you’re a smoker and claim to not be, the insurance policy can actually withhold its payout if it believes you died of a smoking-related illness. If you like to puff away, it’s best to be up front when you apply for the policy.

Photo via Valentin.Ottone