What is the Best Life Insurance Plan for Smokers?

Many smokers know that life insurance policies may come with a higher price tag than their non-smoking peers. But the price of a life insurance policy for smokers may be worth the peace of mind you’ll get knowing loved ones are financially protected. If you’re new to shopping for life insurance, here are some common life insurance plans for smokers and the benefits of each.

Life insurance plan options for smokers

There are several options when it comes to life insurance for smokers:

Term life insurance

A term life insurance for smokers is a short-term plan for a set number of years, often between 10 and 30 years.

Term life insurance tends to be the least expensive option, and it can be a good policy for those who plan to quit smoking. For example, a smoker could take out a shorter term policy, say 10 years. Then, by the time you quit and the term expires, you may qualify for non-smoker rates and be able to lock in a longer 20 or 30-year policy at a much better price.

Permanent life insurance

Permanent life insurance policies, including whole and universal life insurance, offer a death benefit payout like term life insurance policies. But they also offer the ability to accrue cash value. That cash value can then be invested and earn interest, depending on the type of policy and insurer.

For smokers, the primary benefit of a permanent life insurance policy is that it’s for life. So as long as you continue to pay premiums, coverage is there to support loved ones. Plus, the cash value that accrues in the account can be used during your lifetime to support future financial ventures.

Guaranteed issue life insurance

A guaranteed issue life insurance policy typically offers lower payouts, with death benefits designed to pay funeral expenses, not as income replacement. But the major benefit of a guaranteed issue policy is there is no medical exam requirement, and the insurer may not even ask if you’re a smoker.

You can purchase an individual guaranteed issue life insurance policy through an insurance company. But many employers also offer employees guaranteed issue life insurance as a benefit. And that means you may have access to a no-cost, no medical exam life insurance option. Just keep in mind that an employer-sponsored policy may not be portable if you leave the company, whereas an individual policy can go with you as you change jobs.

Simplified issue life insurance

Simplified issue life insurance policies are a fast way to get coverage because they don’t require an in-person medical exam. Instead, these policies use a shortlist of health-related questions. Based on your responses, the insurance company can set a premium and assess risk.

However, since these policies aren’t guaranteed, smoking and other health complications reported on the questionnaire could result in a denial of coverage. So, if you’re interested in this option, it’s wise to talk to an insurance company directly to confirm how smoking will impact eligibility.

Tips for choosing the best life insurance for smokers

Choosing the best life insurance for smokers may come down to:

  • Your health status besides smoking. Those who are generally healthy besides smoking may receive better premiums.
  • Whether or not you want to undergo a medical exam. Guaranteed issue and simplified issue policies bypass the need for a thorough in-person medical exam. Instead, the insurer may ask a few health-related questions or have no medical questions at all.
  • Why you want coverage. Smaller life insurance policies could work well for someone looking to cover only final expenses. But those who intend to replace income or leave a legacy for loved ones may want to consider term or permanent life insurance policies instead.
  • Finding a reputable life insurance company. Companies may vary in who they categorize as smokers as well as how much policies cost. Finding a company with a track record of great customer service and a reputation for insuring smokers gives you a greater chance of finding the right policy.

The bottom line

The best life insurance for smokers is the one that suits your unique medical and financial needs. Since the cost of a policy can vary between insurers, it’s important to shop around and compare multiple quotes. That way, you can lock in the best policy at a price you can afford.

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