Recent research into life insurance in Ireland has shown that thousands of former smokers are paying over the odds for their policy by failing to inform their insurers that they have kicked the habit.
Currently in Ireland the average cost of a smoker’s annual life insurance premium is €250, which compares to just €140 for non-smokers. This means that by informing your insurer that you have been smoke free for a year, you could stand to make a saving somewhere in the region of €100 on your annual premium, resulting in a substantial saving over the policy’s term.
Estimates have revealed that in total, the amount ex-smokers across Ireland are paying unnecessarily in life insurance premiums amounts to €115 million each and every year, simply because they have failed to notify their insurer of a change in their circumstances. To be classified as a non-smoker by a life insurance provider, a policy holder must have been smoke free for over 12 months and should not have used nicotine replacement products at anytime during that year. The trouble is, of those individuals who satisfy these criteria, only 49 per cent inform their insurer.
If you have quit smoking, here’s what you should do…
The prices of life insurance premiums are calculated according to the level of risk each customer represents. We are all aware of the health implications associated with smoking. Non-smokers pay less than smokers for their cover because they are less likely to die during the policy’s term.
So, if you have been a non-smoker for over 12 months and have not used nicotine replacement products during this time, inform your insurer immediately. There is no guarantee they will re-calculate the cost of your premium, but in many instances your premium will drop.
There are certain situations, such as if an individual has been smoking for 30 years before quitting, when an insurer will consider that any damage has already been done and their premiums will not drop.
However, there is certainly nothing to lose by informing your insurer even in this case. As long as there have not been any other changes in your circumstances then your premium should not rise.
For further information about our range of life insurance policies, or to enquire about the impact a change in circumstances may have on your life insurance premium, please call today.