Best Life Insurance for Smokers

Life insurance for smokers can be pricier than normal. But, there are very good options out there. Continue reading to learn more.

April 1, 2021

Cigarette smoking is the leading cause of preventable death. Given the increased risk, it is no surprise that life insurers charge more if you smoke. However, some insurance carriers are more lenient toward smokers than others. So, who offers the best life insurance for smokers in Canada?

Continue reading to find out about the best life insurance for smokers, and our top recommendation.

How are Smokers Defined for Life Insurance?

Man smoking cigar

Drop the word “smoker”, and invariably, one pictures someone puffing away at a cigarette. However, most life insurers will still classify you as a “smoker” even if you use tobacco or nicotine in other forms.

Apart from cigarettes, other products that will classify you as a smoker include:

  • Cigars and cigarillos
  • Electronic cigarettes and vaping
  • Pipes
  • Chewing tobacco
  • Nicotine patches and gums

People who use marijuana occasionally are viewed differently. While some providers rate them as smokers, others take a more lenient view, provided it is not a daily habit.  

How Does Smoking Affect My Life Insurance Rates?

Smokers have a greater risk of developing serious health conditions like diabetes, heart disease, and certain cancers. On average, smokers also die 10 years sooner than non-smokers..

The earlier you are likely to die, the worse it is for your insurer. This is because they will have to pay the death benefit amount before they could collect many premiums. And that — as you may guess — does not work in their favor.

So how do insurance carriers compensate for the additional risk you present to them as a smoker?

The answer is simple: By slapping you with a premium considerably higher than the standard.

A smoker, on average, pays anywhere between two or five times the rate paid by a non-smoker of the same age, gender, and health status. This gap is usually less the younger you are, but widens as you age.

In short, smoking is not good for your health nor your wallet.

Unfortunately, how we classify someone as a smoker is not how insurance companies do it. Most will consider you a smoker even if you have puffed just one cigarette in the last 12 months.

And as we touched on earlier, it is not just cigarette use that will earn you the “smoker” rating. Insurers will brand you a smoker if you use tobacco in other forms, such as cigars, e-cigarettes, chewing tobacco, etc.

What to do When Applying for Coverage as a Smoker?

Life insurance meeting

A “smoker” rating seriously raises your premium rate. Given that, you may think of withholding the truth, especially if you are an occasional smoker — but that is a slippery slope you would do well to avoid. There is a good chance you may get caught and end up in a worse position than if you had told the truth.

Most life insurance policies require a medical exam, which includes urine and blood tests. These tests can detect nicotine and cotinine if present in your system. Since the traces of these two substances can stay inside you for weeks, the insurer is likely to find out about your tobacco use even if you only smoke occasionally.

And if you are wondering if vaping could get you listed as a smoker, the answer is “yes”. Urine and blood tests detect nicotine or cotinine in your system regardless of how you consume tobacco.

However, for the sake of argument, let’s say the insurer does not discover the truth during the underwriting process. Are you in the clear now?

No, not really.

Life insurance policies include a contestability period — usually two years from the date on which the policy first comes into effect. If you die during this time, the insurer can investigate the claim and deny it if you lied on your application.

But what if you survive the contestability period? Are you safe then?

Not quite. If the insurer discovers the truth after two years, they can still adjust the terms of your policy based on what they would have offered you initially had you been upfront about your smoking status. This might lead to a higher premium rate or decreased death benefit.

To sum up, honesty is the best policy when applying for life insurance. Though you are likely to pay a higher rate, you will have peace of mind that comes from knowing that your family’s future is secure.

What if You Quit Smoking?

Life insurers require you to be smoke-free for 12 months or more before they will offer you better rates. If you are young and healthy, you may want to wait that long before applying.

If you have recently stopped smoking and need a policy immediately, consider purchasing a short-term life policy. Alternately, you may purchase a policy that allows you to re-negotiate the premium rate in the future.  

Finding the Best Life Insurance for Smokers

Smokers pay two to five times more than non-smokers for life insurance. However, you can cut down on the insurance cost by picking a provider that offers competitive rates to smokers.

In short, shop around before you sign up. Whether it is life, home, or auto insurance, it is always better to shop around. This is particularly true in the case of life insurance if you are a smoker or have a health concern.

Here is the thing. Life insurers have their own underwriting. As a result, some providers might view a particular health condition as more problematic than others. It also means some carriers may offer more competitive rates to tobacco users than others.

However, before getting online quotes, figure out exactly how much coverage you require. To do this add all your debts (such as home loan, car loan, credit card loan, etc.) and if you have a child, consider the cost of putting them through college. Calculate how much your family might need for end-of-life expenses. In Canada, a funeral can easily cost as much as $10,000.

Then, determine how much your loved ones will lose if you pass away unexpectedly. Without the paycheck you bring home, how will they survive?

Add up these costs to determine the amount of coverage you want. Once you have a figure in mind, grab quotes from multiple providers and compare them.

Smokers looking to buy life insurance can choose from several policy types, including:

  • Term Life Insurance

Term life is the simplest, cheapest, and purest form of life insurance. It has only one purpose — to pay the death benefit to your family if you die within the policy term. Unlike a whole life policy, it does not come with added extras such as cash value, which tend to increase your premiums.

A term life policy lasts for a specific period, such as 10, 20, or 30 years or until you are of a certain age. Your family gets the payout if you die within the term. If you survive it, you get nothing.

Many people use term life as a replacement tool. They are looking for a policy that will provide funds for their family to cover expenses for a certain period if they were to pass away unexpectedly.

Term life is also a good option for covering debts. For instance, if you have a home and car loan, you can take a term policy that lasts as long as your longest debt and has a payout that can cover both the loans. This will ensure your debts will not fall on the shoulders of your loved ones if you die suddenly.

  • Whole Life Insurance

A whole life policy lasts your entire lifetime. That means your beneficiary will receive the death benefit after your death, whenever it is. For this reason, whole life is the closest thing to fill-it-shut-it life insurance.

Whole life policies also include a cash value account, which grows over time. The policy’s cash value is for you to use while you are still alive. You can withdraw from or borrow against the cash value at any time and use the money however you like. Whatever cash value there is left unused at the time of your death will be absorbed by the insurer, and your family will only receive the death benefit.

  • Guaranteed Life Insurance

This type of life insurance product requires neither a medical exam nor health screening. If you are a smoker with a serious health condition, this option may appeal to you since the coverage is almost guaranteed.  But remember, the coverage is limited — usually capped at $25,000. That said, some life insurance is better than none.

With guaranteed life, your premiums are based on of your age, gender, and coverage amount. Your health and smoking status are not considered. The caveat, however, is that such a policy costs considerably more than a fully underwritten one.

Recommended Top Companies for Smokers


So, which provider offers the most competitive rates for smokers in Canada?

Our research show Industrial Alliance has the lowest rates for smokers across all age groups. In addition to competitive rates, they also offer a lot of flexibility. A case in point is their Pick-A-Term life insurance, which allows you to pick any term from 10 to 40 years.

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