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Insurance Reports

New Data Shows Smoking Can Increase Your Life Insurance Premium by Nearly 100%

Updated Apr 05, 2023   |   6 mins read

Although naturally grim in its circumstance, life insurance can be an important safety net for a policyholder’s loved ones.

But having life insurance comes at a cost, so consumers must weigh the pros of paying for a policy against the potential consequences of not having one.

That cost depends on the policy and the person. Things like age, medical history, current health, and smoking habits can alter a person’s annual life insurance premium.

For example, because smoking is detrimental to a person’s health, policies for smokers are more expensive to account for the increased likelihood of mortality within the policy term.

Just how much can smoking increase a life insurance policyholder’s premium?

To answer this, LendEDU teamed with BestLifeRates, an independent life insurance marketplace. Using exclusive data from about 35,000 life insurance policy quotes provided by BestLifeRates, LendEDU analyzed the dollar difference in life insurance policy quotes between smokers and non-smokers.

How Smoking Affects Life Insurance Costs

The data featured in this report was anonymized and provided exclusively to LendEDU from BestLifeRates. Users can go to BestLifeRates.org, enter their personal information, and receive life insurance quotes based on their circumstances, including whether they are a smoker.

BestLifeRates works with NinjaQuoter to gather the data and provide quotes to users.

On Average, Smokers Will Pay Nearly Double the Life Insurance Premiums of Non-Smokers

As the above graphic illustrates, the data shows smokers, on average, will pay nearly double for life insurance premiums what non-smokers will pay.

The average annual life insurance premium BestLifeRates quoted for smokers was $3,977, while this figure was $2,052 for non-smokers. These figures indicate that smoking could increase life insurance premium costs by 94%.

The average annual life insurance premium quote for the entire dataset, including both smokers and non-smokers, was $2,241.

The above figures do not account for things like age, type of policy, or coverage amount. We’ll look at those below.

Analyzing Differences in Premiums for Smokers & Non-Smokers Looking for a 10-Year Term Life Policy With $250,000 in Coverage

The graphic above represents all consumers who requested a quote for a 10-year term life insurance policy with $250,000 in coverage. This breakdown shows how smoking can impact annual life insurance premium quotes for consumers who were all looking for the same life insurance product.

With nearly every age group, with the exception of the youngest and oldest, smokers got life insurance quotes with annual premiums that were more than double those non-smokers received.

When age was not factored in, smokers in this subsection collectively got quotes for their premiums that were 109% more than what non-smokers got.

Removing smoking from the equation, the graph also depicts how age greatly impacts what people may pay for life insurance policies. For example, while the average annual premium quoted for those in their 20s was $155, it was $4,793 for those in their 70s.

This is because, as a consumer gets older, their health risks generally increase, making them riskier for life insurance companies.

Things You Should Consider Before Buying Life Insurance

Buying life insurance is not only a major life decision, but a serious financial one as well, so it’s of the utmost importance that you do your homework before fully committing to life insurance.

Here are a few things that LendEDU thinks you should consider before you buy a life insurance policy.

Ask Yourself if Life Insurance is Really Worth it For Your Situation

Everyone’s situation, and budget, is different, and this means that the value of a life insurance policy differs by the consumer. Before taking out a life insurance policy, you must think about if life insurance is worth it for your current situation.

And more specifically, if you do decide that life insurance is worth it than you also must think about if a whole life insurance policy is worth it or if term life insurance is more worthwhile.

Figure Out What Type of Life Insurance You Need

If you do end up deciding that life insurance is worth it for your situation, then it’s time to start comparing and contrasting the various life insurance companies.

Further than that, you must also decide between whole life insurance and term life insurance. The best way to decide between the two is by first doing your due diligence on what each policy type offers and then seeing how each fits into your specific situation.

Calculate How Much Life Insurance You Need

Finally, if you think that life insurance is truly right for you and your situation, then it’s time to figure out how much life insurance you need.

In order to calculate this, you will need to factor in things like your outstanding debts, annual salary, and future financial obligations. Once those things are tallied, you can subtract whatever amount you have currently saved in liquid assets or other accounts and the final amount is equal to the total cost of life insurance you should aim for.

Methodology

All data found in this report was anonymized and provided exclusively to LendEDU by BestLifeRates, an independent life insurance marketplace. The dataset features over 35,000 unique life insurance quotes that were provided to visitors of BestLifeRates.org who were looking for a life insurance policy quote based on their unique circumstances.

BestLifeRates works with NinjaQuoter to collect and analyze the user data to provide life insurance policy quotes.

The data that was included in this report has been collected over an extended period of time, starting in October of 2016 and ending in September of 2019. The data includes things pertinent to providing a life insurance policy quote, like smoking habits, age, location, coverage amount sought, and whether the consumer was looking for a whole life or term life policy.

The annual premium amounts that were quoted for each consumer are projections made by BestLifeRates and NinjaQuoter and may not accurately reflect the terms that the consumer ended up receiving. Additionally, specific types of smoking habits that may alter the life insurance policy rate were not specified, including whether the consumer was vaping, smoking cigars or cigarettes, or smoking marijuana.

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