Life Insurance in Canada: Smoker versus Non-Smoker Rates

If you smoke and are looking to buy life insurance in Canada, you can expect to pay a much higher premium than a non-smoker. On Term policies the premiums can be more than double on permanent plans the difference in rates is less pronounced.

The insurance definition of a smoker is male or female who uses nicotine, including cigarettes, cigars, chewing tobacco, a nicotine patch and nicotine gum.  Remember that to qualify for preferred rates, the insurance company can look back up 12 months.

Though, most companies do allow occasional cigar use to still qualify for non-smoking rates. Insurers generally generally allow one large cigar per month per year.  Our article Cigar Smoker and Life Insurance lists the details on how nine different insurance companies in Canada treat cigar use, and evaluates the cigar smoking applicant’s ability to obtain non-smoker rates.

The following compares smoker and non-smoker rates for a 40-year-old male non-smoker and smoker in need of $500,000 of coverage. As mentioned, rates are more than double for smokers on Term plans, but only about 25% higher on Permanent plans.

40-year-old, male non-smoker:

$500,000.00 Term 10 with BMO Insurance is $385/year

$500,000.00 Term 20 with Canada Life is $675/year

$500,000.00 20-Pay with Manulife is $4,470/year

40-year-old male smoker:

$500,000.00 Term 10 with Equitable Life is $875/year

$500,000.00 Term 20 with Canada Life is $1,745/year

$500,000.00 of 20-Pay coverage with Manulife is $6,225/year

LSM Insurance President Chantal Marr notes that the difference between smoker and no smoker rates is much less pronounced for older applicants.

For more details on the difference in premiums between smokers and no smokers, you can contact us at 1-866-899-4849 or visit our Term Life Insurance Quote Page.

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LSM Insurance
LSM Insurance

Good point from advisor Tim Landry

A change to non-smoker has always been subject to medical evidence. No insurer will give non-smoker rates (nor should they) to someone who quit smoking because they found out they had (for example) cancer. This change has – as I said – always been subject to health evidence

LSM Insurance
LSM Insurance

Hi Jules, The attached article also shares some additional insights http://www.theweedblog.com/life-insurance-and-marijuana/ on marijuana use impact on life insurance.

Jules
Jules

How long do you have to stop marijuana use before you are considered a non smoker and how can the insurance verify you are not using it.

LSM Insurance
LSM Insurance

Hi Jules, Thanks for the note. Most insurance companies will require you to stop marijuana use for a minimum of 1 year to qualify for non smoker rates.

Depending on how much you used this could be longer. All questions are assumed to be answered truthful and a material wrong answer could result in a denied claim. They may also do a urine or blood test.

Ulius
Ulius

Can I get non smoker rates if I use Nicorette I use it very infrequently but I don’t want to lie on my application and risk it noit be paid out

LSM Insurance
LSM Insurance

Most companies will treat Nicorette use as tobacco use and you would have to pay smoker rates. But you would have to check the application. Thanks

Gabriel
Gabriel

Hi,
If I use a personal vaporizer a.k.a. electronic cigarette with no nicotine in the liquid do I qualify as a non-smoker or not? Thanks

LSM Insurance
LSM Insurance

Thanks Gabriel – That’s a good question. We will investigate the answer and be in touch.

Amo
Amo

How long do I need to be tobacco free to qualify for preferred rates?

LSM Insurance
LSM Insurance

It differs among companies but most insurance companies are 3 years tobacco free to qualify for preferred rates

Cameron
Cameron

I have a whole life policy with smoker’s rates. I have been smoke free for almost 7 months. Should I wait 5 more months to apply for non-smoker rates and will my cash values increase when I reapply?

LSM Insurance
LSM Insurance

Thanks for the note Cameron. Most insurance companies require the insured to be tobacco free in order to qualify for non smoker rates.

If you pay the same premium a higher portion should go towards the cash value component as the risk charge will have decreased.

Crazy Jay
Crazy Jay

If i started smoking if I took out my policy, do I have to let you guys know. I’m covered for $200,000

LSM Insurance
LSM Insurance

Your policy is based on your information at the time of application. As long as you were truthful on the initial application, if you started smoking afterwards it will not impact your policy.

LSM Insurance
LSM Insurance

All things being equal a smoker pays more than a non smoker because there is added health risks with smoking.

But a non smoker with a history of heart disease or diabetes as an example may pay more than a healthy smoker

Winston
Winston

I am a healthy smoker and workout and eat pretty well – why am I paying more than a non smoker who eats garbage and never works out.

LSM Insurance
LSM Insurance

Hi Simon,

The policy is based on your healthy and lifestyle information at the time of application. So if you were a non smoker at the time of application the policy would be valid assuming all questions were answered correctly. You should also be able to convert the policy at non smoker rates.

Simon
Simon

If I have a small 5 year term life insurance ($100,000) with Industrial Alliance first issued over ten years ago when I was completely a non-smoker, but now I smoke 4 large cigars per month or 1 per week, is my insurance now worthless when I send in my renewal stating “non-smoker” ???

LSM Insurance
LSM Insurance

Thanks for the note. Nothing sinister intended. All those things work in your favour when applying for life insurance

D. Howse
D. Howse

it that an insurance industry code for something more sinister?
If I’m a non-smoking, non-drinking, non-gambling, non-bungee-jumping, faithful-to-my-first-wife, all-around good guy, shouldn’t I be getter lower premiums?
I’m just askin’…..

LSM Insurance
LSM Insurance

Hi Mark,

Thanks for the note. Great question we get asked this a lot.

No your life insurance policy is based on your medical and lifestyle questions at the time of application. Regards, Lorne

Mark
Mark

Hi. What if I was a non smoker when my policy was issued 10 years ago and fell off the wagon a few times over the years? That wouldn’t void my policy would it? Thanks.

LSM Insurance
LSM Insurance

Thanks for the note Lynn. Term life policies do not generate a cash value. But Whole Life policies would – the percentage of cash you will get back will depend on the type of plan and how long you have it for. Generally it is not advisable to take a Whole Life policy if you are thinking of cashing it in the first 10 years.

lynn whelan
lynn whelan

hello if i purchased term life insurance and after ten years decided i dont need it any longer, say my kids are grown, can i cash out my life insurancepolicy, and how much would i get back, the premiums plus interest, thanks