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Smokers cough up 50% to 80% more in life insurance premiums

Smokers cough up 50% to 80% more in life insurance premiums
Neesa Moodley
By Neesa Moodley
26 Jul 2023
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‘While smokers have long been rated as higher risk when it comes to health and life insurance, people who vape are now also considered candidates with a higher risk.’

The new Tobacco Products and Electronic Delivery Systems Control Bill, which is intended to further regulate the smoking industry, is open for public comment – but how many smokers consider the financial impact of their habits?

First, there’s the actual expense in your grocery budget – a pack of 20 Peter Stuyvesant Red cigarettes cost R46. If you smoke a pack a day, that works out to R322 a week – R1,288 to R1,610 a month. According to Momentum Myriad in 2020, a smoker’s life insurance premium was as much as 80% more than that of a non-smoker.

Motshabi Nomvethe, head of technical marketing at the Professional Provident Society says that “on average”, the premiums for non-smokers are about 50% less than for smokers. Other factors influencing premiums are age, gender, health and other lifestyle habits.

There are, of course, many other benefits that come from not smoking. 

“So, if a person also had premium loadings and/or exclusions for certain conditions directly linked to smoking, these could also be reviewed,” she says.

Tobacco epidemic


According to the World Health Organization, the tobacco epidemic is one of the biggest public health threats the world has faced, killing more than eight million people a year. This includes about 1.2 million deaths from exposure to second-hand smoke.

Vapes produce an aerosol by heating a liquid that usually contains nicotine, flavourings and other chemicals. Users inhale this aerosol into their lungs, and bystanders can also breathe it in when it is exhaled.

With the rise in vaping in South Africa, the department of health is banking on the new proposed Tobacco Bill to deter people, especially children and youth, from smoking and to update the rules developed three decades ago, with the regulations extending to include vapes and e-cigarettes.

“While smokers have long been rated as higher risk when it comes to health and life insurance, people who vape are now also considered candidates with a higher risk, as they are more likely to be subject to increased medical costs throughout their lifespan,” Nomvethe says.

At PPS, you are regarded as a smoker if you used any nicotine delivery device within the past 12 months, regardless of the frequency of use. This includes e-cigarettes, vaping devices, hookah pipes and cigars. While Nomvethe says you will pay premium rates according to your smoking status, he adds that once you have stopped smoking for a minimum of 12 months, you should contact your insurance provider as you are likely to qualify for a lower premium.

Nicotine test


If you do declare you have given up smoking, your insurer may require a nicotine test before your premiums are reduced accordingly. 

Cancer.net reports that lung cancer is the second most commonly diagnosed cancer and is the leading cause of cancer deaths for men and women globally.

In 2022, PPS paid members a cumulative R416-million for critical illness claims, with cancer a leading cause of those claims. Breast cancer and prostate cancer were the most common.

Oesophageal cancer


However, the South African Journal of Oncology notes that the evidence for tobacco as a risk factor for oesophageal cancer is strong in South Africa. This is backed up by the Cancer Association of SA, which says oesophageal cancer is responsible for the second-highest number of cancer-related deaths in South Africa.

“Oesophageal cancer is one of the most unknown and deadliest cancers worldwide, mainly because of its extremely aggressive nature and poor survival rate. It is the sixth leading cause of death from cancer and the eighth most common cancer globally,” the Cancer Association reports.

Critical illness benefits


Nomvethe points out that critical illness benefits can also be used for day-to-day, out-of-pocket expenses such as hiring a nurse or an au-pair to care for your children or to fetch them from school and help with homework. 

“Other costs not often considered include hiring a person to prepare meals, transportation to and from appointments, staying at a specialised facility for extended nursing care and mental health support such as counselling. 

“Buying wigs, speciality bras or other clothing, fertility treatments and certain foods may all create extra costs for patients depending on the type of cancer, the length of treatment, side effects and other factors,” he says. DM

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