What If I Start Smoking After Taking Term Insurance?

The health details provided during the policy subscription influence your term insurance premium. If you begin to make changes to your lifestyle, such as smoking, then that could affect your term insurance. Smoking after getting a term insurance plan could lead to issues, such as a claim being denied.

When applying for term insurance, providers categorise you based on your smoking practices. This is crucial because it determines your suitability for the policy and the premium you will pay.

So, let’s learn more about the potential consequences of premiums and claims as a result of starting to smoke after taking a term policy. Understanding how these changes might impact your life insurance policy is essential.

1. Preferred Smoker

2. Typical Smoker

3. Table-rated Smoker

Legal and Ethical Implications

Increase of Premiums Increase

Impact on Claims

Consequences of Non-Disclosure

If you don’t mention that you’ve taken up smoking, it can have grave consequences and even jeopardise the policy definition. Moreover, when an event occurs, the insurer may not be able to pay out any claims when you need it most.

If you unfortunately pass away during the policy term due to smoking-related health problems, the insurance company could deny the claim. In such cases, you might lose all the premiums you’ve paid.

Procedure for Updating Your Lifestyle Information

Re-Assessment of Policyholder’s Health

When it comes to reassessing policyholders' health, there are a few common ways to gather information:

• You might need to go through a medical exam, in which you might be asked about your smoking habits.
• Tests might be conducted to check for nicotine in your blood, urine, or saliva.
• Insurance companies might ask to see your medical records. These records can provide insights into your smoking habits.
• Your prescription history might be checked to gather valuable clues about your smoking journey.

Possible Outcomes

If the policyholder discovers you have lied about your smoking habits after the reassessment tests, the following consequences may result:

• If your insurer finds any discrepancies, your policy might be cancelled.
• If you pass away and it turns out that your smoking habits weren't accurately disclosed, your loved ones might face a denied claim for the death benefit.
• If your policy is cancelled or a claim is denied, any premiums you've paid may not be refunded. Giving false information can be seen as insurance fraud, which could lead to legal trouble.
• A history of non-disclosure could affect your future insurance applications, leading to higher premiums.

In India, most insurance providers don’t allow you to change your status from smoker to non-smoker once your policy is in place. If you quit smoking, it usually won’t affect your current premium or policy, but after a few years of being tobacco-free, you can reapply for a new term plan as a non-smoker. To make informed decisions, consider using a term insurance calculator to evaluate your options based on your health and lifestyle. 

Some insurers might allow you to request a review of your plan if you haven’t smoked in the past few years. They may be willing to offer a lower premium for being tobacco-free. However, it might still be higher than if you’d been a non-smoker.