Why Should Smokers Not Avoid Buying Term Insurance Cover Despite Hefty Premiums?

Term insurance plans do not provide a maturity benefit but instead offer a substantial lump-sum payment at cost-effective rates to policyholders' nominees if they die. While term insurance prices have been low in India for nearly a decade, insurers demand costly rates from smokers because of the dangerously high death rate among those who smoke. However, do not hesitate to purchase a term policy only because you have to pay a higher premium due to your smoking habit. A suitable plan is essential to ensure the financial future of your dependents, especially in these trying times. 

Who is Considered as a Smoker?

Those who use tobacco or nicotine in bidis, cigars, cigarettes, gutka, pan masala, chewing gum, nicotine patches and other forms are referred to as smokers by insurance companies. People are frequently divided into four categories by insurance companies: non-smoker, preferred smoker, usual smoker, and table rate smoker. Apart from his smoking habit, a favoured smoker can be fit and healthy, whereas a typical smoker may have minor health issues. A table rate smoker, on the other hand, has serious health problems as a result of smoking. Premium rates are set based on these groups.

Why are Smokers Charged More Premiums than Non-Smokers?

Smokers are charged more premiums on their term insurance policies as they have a high mortality rate and are unquestionably more vulnerable to accidents or death than non-smokers. Moreover, they have a more prominent health risk factor linked with their lives, which is why they pay higher rates. Although many policyholders find purchasing a term insurance policy pointless because of high premium rates, it is not the truth.

Why Should Smokers Not Avoid Buying Term Insurance Cover Despite Hefty Premiums?

Smokers are more likely to get cancers such as lung cancer, throat cancer, and oral cancer. Hence, such a division is seen as both essential and reasonable. Moreover, as Covid-19 targets the lungs first, a person who already has a compromised respiratory system due to their smoking habits should consider purchasing a term insurance policy. So, if the policyholder dies, term insurance guarantees to pay a lump-sum payment to the insured's family. 

What Happens When You Lie About Your Smoking Habits?

People frequently lie about their lifestyle choices to avoid paying higher premiums. This is useless because medical exams examine people's smoking habits, and there is no way to avoid paying higher premiums. You should invest in term insurance coverage for your loved ones because they will be the ones to face the emotional loss as well as the financial burden that would come with your death. Furthermore, lying about your smoking habit can result in severe consequences. You could be charged with fraud, and your insurance policy could be cancelled. Additionally, suppose the life assured dies due to a smoking habit that was not declared at the time of the policy's initiation. In that case, the claim request may be denied by the insurance provider. 

Endnotes

All you should do is tell the truth from the beginning of your coverage and accept the expensive insurance because of your smoking habits. Moreover, since you're buying term insurance for your loved ones, you must let your insurer know if you have smoking and drinking habits as they will come up with the best plan to give you the value for your money.

Also read

Reasons Why You Need To Secure Your Family With A Term Plan

How to Purchase Term Insurance Plan Online?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.