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Want insurance? Quit smoking

Pick your pleasure
Pick your pleasure
Photo by Justin Sullivan/Getty Images

Do you smoke? Or use tobacco in some form? Or use quitting aids such as nicotine gum or a patch? Even if you've switched to e-cigarettes, your term life insurance rates will cost you hundreds, maybe thousands of dollars more per year. In fact, according to a study conducted by (, smokers could pay as much as triple the amount that non-smokers pay. This study looked at term rates for men and women at ages 25, 35, 45, 55 and 65, smoker and non-smoker, with a face value of $500,000, using the data from the top 25 carriers, representing 70% of the market.

So how much more? For a female age 25, a smoker would pay $456 more per year,$1,500 per year at age 45, and at age 65, $8,500! And, because men have a shorter lifespan than women, the rate gap is even greater, ranging from an additional $600 to $11,000 more per year. Add to this the health issues. According the U.S. Centers for Disease Control and Prevention (,) smoking accounts for 1 in every 5 deaths per year, or about 480,000 people. In fact, smoking deaths exceed all the deaths from alcohol use, illegal drugs, car accidents, shootings and HIV infections combined. Compound this with associated illnesses such as diabetes, heart disease and lung cancer, and you'll understand why insurance companies have had no choice but to hike term life rates.

So, what are your options? The first is to shop as many companies as you feel necessary. The rates will all be high, but some companies that try and discourage insuring smokers will be much higher. Most companies offer a "level" premium policy, with premiums the same for the length of the policy, either 10, 20, or 30 years. Some companies, however, issue an "annually-renewable term" or ART. These policies have premiums that are lower initially, go up each year, eventually surpassing the level premium cost. But the real option, and one you already know about, is to quit smoking. The average cost today of a pack of cigarettes in Michigan is $6.95. What does this mean to you in terms of cost? Well, if you smoke a pack a day, your cost for the year would be $2, 536.75. So, if you're a 45-year old female smoker, and the difference for $500,000 is $1,500 more per year, by quitting, you'd not only save the $1,500, but an additional $2,500 by not buying cigarettes. Many people today - almost 69% of workers - feel their retirement plan is inadequate. Could this extra $4,000 per year help with that?

So, if you need life insurance, by all means, get it. Obtain the protection for your family that a tax-free death benefit can provide. Yes, you'll need to pay some higher rates, but then quit smoking. After you've been nicotine-free for 12 months, you're eligible for a re-consideration, by simply providing a urine specimen. No other underwriting is conducted. Finally, one last piece of advice: if you're younger, your costs will be much less. Don't wait until you need it; it may be too late.