A couple of months ago, a client approached one of the advisors at Ditto. Here’s how the conversation went down -
Client: “I have been smoking for the last 5 years or so. I am now married with a kid and want to purchase a term insurance policy. Am I eligible?”
Our advisor: “You are absolutely eligible, Sir. However, there will be some restrictions, and you have to expect a certain premium spike.”
Client: “What kind of restrictions am I looking at? And why should I be paying higher premiums?”
These kinds of conversations are regular for our team! However, the topic of term insurance for smokers in India is quite interesting. We have found that a majority don’t know that -
- Since smokers present a risk of contracting critical ailments, term insurance providers view them as risky profiles, presenting higher chances of payouts. Thus, smokers often end up paying high premiums.
- In the case of male and female smokers, the premiums vary.
- Suppose you try to withhold information about your smoking habit, and it gets exposed later (before the moratorium period). In that case, you may end up with no coverage, limited coverage, or even blacklisting.
But, all of these are just the tips of the iceberg (mostly targeted to motivate you to stop smoking). There are more such facts that you need to know if you are looking around to purchase the best term insurance plans for smokers in India. Here’s what we know!
Heads Up: It takes an average person up to 5 hours to read & analyze a policy, and 10 hours or more to compare different plans and make a decision.
This is why we propose a better alternative - taking a 30-minute FREE consultation with Ditto’s certified advisors. We have a spam-free guarantee, and we’ll never push you to buy a plan. Don’t delay this - we have limited slots every day, so book a quick call here before they run out.
Best Term Insurance Plans for Smokers in India
Who are Smokers As Per Term Insurance Providers in India?
Term insurers define "smokers" in two main ways:
- The term extends beyond just cigarette smokers; it includes anyone who uses any form of tobacco.
- A person who has used tobacco products within the 12 months preceding their application for term insurance is classified as a smoker.
Are Smokers Eligible for a Term Insurance Policy?
Yes, smokers can obtain term insurance plans, but they should be prepared for some trade-offs. Here are a few key points to consider:
- Smokers pay a spiked premium for their term plan: Smokers face higher premiums for their term insurance policies. Due to the increased risk of serious health issues such as lung and oral cancers, insurers often charge smokers premiums that are 30% to 50% higher than those for non-smokers. This adjustment helps insurers manage the financial risk associated with the higher likelihood of claims.
- Types of smokers according to term insurers: Term insurance providers categorise smokers into -
- Repercussions in case of non-disclosure of smoking habits: It’s crucial to be honest about your smoking habits when applying for term insurance. Failing to disclose your smoking status can lead to serious consequences, such as accusations of fraud, rejection of claims, or even the cancellation of your policy. This could leave your family without coverage in the event of your death.
While smoking results in higher premiums, the coverage provided by a term insurance policy is significant and ensures financial protection for your loved ones. Even though the increased premium can be a burden, it’s a worthwhile investment for their security.
(P.S.: Top term insurance plans are generally affordable and don’t significantly impact your annual savings. Smoking increases the premium significantly. To lower your premium, consider quitting smoking at least a year before applying for a term insurance policy.)
If you start smoking after purchasing the policy, you must still disclose this change at renewal. Otherwise, if you make a claim and your smoking status is discovered, it could complicate the claim process and result in delays or reduced payouts.
How Do Term Insurance Plans Vary for Smokers and Non-Smokers?
Best Term Insurance Plans for Smokers in India
- ICICI iProtect Smart – ICICI Prudential Life provides a single-term insurance plan with four options for death benefit payouts:
- Lump Sum
- Income
- Lump Sum plus Income
- Increasing Income
The plan also offers four different options, each with various rider combinations:
- Life
- Life Plus
- Life and Health
- All In One
These options include benefits such as Waiver of Premium, Terminal Illness Benefit, Waiver of Premium for Disability, Accidental Death Benefit, and Critical Illness Benefit.
Drawbacks: The insurer’s overall operation proficiency is a bit concerning.
2. Max Life Smart Secure Plus Plan: Max Life's term insurance plan is highly regarded in the industry for its comprehensiveness and affordability. It comes with a wide array of built-in features and riders, such as:
- Terminal Illness Benefit
- Three Variants of Critical Illness Riders
- Voluntary Top-Up Sum Assured
- Joint Life Cover Option
- Premium Break Option
- Waiver of Premium Plus
- Disability Rider
These options make it a versatile and valuable choice for insurance coverage.
Why Talk to Ditto for Your Health Insurance?
At Ditto, we’ve assisted over 3,00,000 customers with choosing the right insurance policy. Why customers like Srinivas below love us:
✅No-Spam & No Salesmen
✅Rated 4.9/5 on Google Reviews by 5,000+ happy customers
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✅100% Free Consultation
You can book a FREE consultation. Slots are running out, so make sure you book a call now!
Drawbacks: None that we could find!
3. HDFC Life Click 2 Protect Super: The Click2Protect Super plan provides an in-built terminal illness benefit and a smart exit feature, making it a comprehensive option, though it is somewhat more expensive than the Click2Protect Life policy. It is available in three variants: Life, Life Plus, and Life Goal. The plan also offers a variety of riders, including:
- Waiver of Premium for Critical Illness
- Return of Premium
- Waiver of Premium for Total and Permanent Disability
- Spouse Cover Option
- Option to Alter Premium Frequency
- Option to Change Premium Payment Term from Regular Pay to Limited Pay
- Renewability Option at Maturity
- Life Stage Option
- Death Benefit as an Instalment Option
These features enhance the flexibility and coverage of the policy.
Drawbacks: It’s a tad bit expensive.
