How vaping affects life insurance rates

Vaping has become a more common alternative to smoking, but life insurance companies often don’t distinguish between the two. 

Vaping involves inhaling a liquid solution from an e-cigarette or another electronic smoking device. Unlike traditional cigarettes, e-cigarettes produce an aerosol that users inhale or exhale. Though the aerosol doesn’t contain tobacco, it does consist of nicotine and other toxic chemicals. Health officials warn those chemicals can adversely affect lung health.

The Centers for Disease Control and Prevention estimated that there have been 68 deaths and 2,807 cases of hospitalization due to vaping or e-cigarette-related lung injuries. As the health effects of vaping become better known, the practice will have more of an impact on life insurance coverage and rates. 

Let’s take a look at vaping and how it influences life insurance costs. 

 

Does vaping affect life insurance?

Frank Campbell, a chartered life underwriter and licensed life & disability analyst with more than 30 years of industry experience says most, if not all, life insurance carriers treat vaping the same as smoking.

“There’s no question on any application we know of which distinguishes between the two,” Campbell says.

As part of the life insurance application process, a life insurance company will ask about your health history and lifestyle habits. You’ll additionally have to undergo a medical exam and provide a urine or blood sample. The blood test can identify nicotine and other substances in your body. This means that you’ll have to pay higher life insurance rates than a non-smoker if you smoke or vape. 

How vaping affects life insurance rates

Insurers use a specific classification system to determine life insurance rates. Classifications can range from Preferred Plus (the highest rating) to Substandard (the lowest rating):

• Preferred Plus
• Preferred
• Standard Plus (or Regular Plus)
• Standard (or Regular)
• Substandard

Lower ratings lead to higher premiums. So, if you smoke or vape, you could be placed in one of the Standard or even Substandard categories, since these practices can cause lung diseases that affect life expectancy. Life expectancy is one of the most critical factors life insurers consider when they determine whether to approve you for a policy and what rate you’ll pay.

How much more you’ll pay depends on the company. However, you could pay double or more if you vape. 

Here are the average annual level term life insurance premiums for a 20-year term life policy with a $250,000 death benefit for a smoker: 

Source: Compulife Quotation System, 2023.

 

What if I’m using vaping to stop smoking?

Even if you’re using vaping as a smoking cessation tool, it won’t lead to a lower rate.

Insurers “tend to view quitting smoking in the same way they view pregnancy. If you’re pregnant, you’re pregnant. If you smoke, you smoke,” Campbell says. “If you want a non-smoker rate, come back when we can verify you’ve been free from nicotine for one full year.”

To potentially qualify for a better insurance rate, you’ll need to quit smoking or vaping for at least 12 months. After this, you can ask your insurer to review your rate and see if they can reclassify you, Campbell says. 

Whether you currently vape or are actively trying to quit, Campbell says it’s best not to wait to apply for life insurance.

“Life insurance isn’t purchased with you in mind. It’s purchased because you have a beneficiary who needs the money if you don’t make it home one night. If they need it next year, they probably need it today as well.” he says. “I can’t bring them a check for a policy you intended to buy next year at a more favorable rate. On the good side, if you buy the insurance now at the smoker rate and quit, we can get the company to reconsider in a year and reduce the rating down to non-smoker. That’s a way better option for your loved one than waiting.”

 

Can you lie about vaping on your life insurance application?

Even though vaping can lead to higher insurance rates, it’s best to be completely honest when applying for life insurance.

Life insurance applications typically include a question about whether you’ve smoked in the last year. There’s also usually a medical exam, so if you don’t answer this question honestly, nicotine may show up in your test results if you’ve vaped in the days leading up to your exam.

However, if you clear both hurdles without an insurer finding out about your vaping history, your beneficiaries could still pay the price later. An insurer could later claim you committed insurance fraud and deny your loved ones the death benefit if an autopsy discovers you died of smoking-related causes but weren’t transparent about vaping on your life insurance application.

“If there’s a claim in the first two years, the company will investigate before they write the check. If they find there was a ‘material misrepresentation,’ which was not disclosed on the application, they will refund the premiums paid and not write the bigger check your beneficiary needed,” Campbell says.

The bottom line is that it’s better to be honest and pay the higher premium than lie and risk the insurance company denying your beneficiaries money they really need after you’re gone.

 

Your life insurance options if you vape

If you apply for life insurance and don’t qualify for traditional coverage, a guaranteed issue policy may be your only other option. Guaranteed issue insurance doesn’t require a medical exam. However, premiums are higher and coverage amounts are lower. These policies also feature a “graded death benefit.” A graded death benefit means your beneficiaries will receive a reduced death benefit if you die within the first one or two years of the policy.

Group life options are always worth looking into through your job, as these are often offered to participants with no medical questions or exams.

Another option is simplified issue life insurance. These policies don’t require a medical exam, but you will need to answer a few health-related questions. 

Campbell says if you vape and are looking for life insurance, working with a professional underwriter can help you find the best company and the best policy for your needs. But as more evidence emerges about the health effects of vaping, it could mean even higher rates for vapers in the future, Campbell adds.

“If you need insurance and are vaping, now is the time to get a policy in place before risking companies change their stance on this issue to something stricter as more research comes out about its impact.”

Life insurance can be an important financial tool for families. Though your health history will affect your chances of approval and what kind of coverage for which you may qualify, it never hurts to apply. 

If you’re unsure of how much life insurance you’ll need, use our life insurance advisor to get more information about your insurance options. Our life insurance calculator also can help you determine the right level of coverage.

Sources:

Centers for Disease Control. “Outbreak of lung injury associated with the use of e-cigarettes.” Accessed July 2023.

 

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