Life insurance – How many cigarettes are too many?

by rebecca brereton

Many consider that smoking the odd cigarette every now and again socially will automatically place them into the non-smoker category, but recent research has discovered that this is almost certainly not the case where most life insurance providers are concerned.One policyholder discovered that his premiums had increased by £11 per month, despite the fact that he only ever smoked a maximum of 1 cigarette per week. Tom Barker from Macclesfield, Cheshire comments, “My existing life insurance policy had a few months left to run, so I decided to speak to my IFA regarding a replacement policy. When asked if I smoked, I automatically said no. After further questioning, my adviser informed me that by smoking just one cigarette per week, it would put me in the smokers category. Instantly increasing my life insurance premiums.”An increasing amount of life insurance applicant's are finding that their smoking status is set at “smoker”, despite not smoking on a regular basis.Tom was informed by his IFA that should a claim arise, and the insurance company investigate his smoking status, a claim could be refused on the grounds of false information. He was therefore advised to state that he was indeed a “smoker”.For Tom to avoid increased premiums, he would have to provide 12 months worth of not smoking. Before this 12 months, the life insurance company would not consider recalculating his premiums.Strangely enough, if a person were to take out a life insurance policy whilst a non-smoker, and then take up smoking afterwards, the policy would remain valid. However, if a policy is written on a yearly or 5 year renewal basis, the policyholder is obliged to disclose this information at the point of renewal, to keep the policy valid.The Association of British Insurers are advising all life insurance policyholders to disclose full and honest information at the point of application.With modern technology, insurers can detect whether an applicant has either smoked or used illegal drugs, even if it occurred months beforehand.In the event of a claim, the policy could be declared void.

Comments? Questions? Email Here

© HowtoAdvice.com

How to Advice .com