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Spring 2020  Volume 13, Number 1        

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Life Insurance and the High Cost of Vaping

Is vaping safer than cigarettes? Insurance companies don't think so.

Smokers pay higher rates for life insurance, and while vaping might seem less dangerous than smoking, life insurance companies charge vapers the same high rates as they charge smokers.

Vaping is a form of nicotine delivery that doesn't produce smoke. The basic vaping device, or e-cig, has a coil, battery, tank and juice. When a vaper inhales from the device, the battery heats the coil which atomizes the e-juice in the tank.

This process can create undesirable by-products. It's important to note that e-juice doesn't contain tobacco, although it does contain nicotine. The levels of nicotine are typically lower than what is found in cigarettes and typically don't contain many of the dangerous chemicals found in cigarette smoke.

Federal Regulations

However, the U.S. Food and Drug Administration (FDA) ruled in 2016 that e-cigarettes are "tobacco products," and are subject to federal regulation.

In early January, the Trump administration announced that it will prohibit fruit, candy, mint and dessert flavors from small, cartridge-based e-cigarettes that are popular with young people. Though large, tank-based vaping devices, which are primarily sold in vape shops that cater to adult smokers, are exempt. Menthol and tobacco-flavored e-cigarettes though are still allowed to remain on the market.

In part, the FDA stance on vaping has led life insurance companies to classify e-cig users as smokers. Insurers have also been concerned about of the lack of any uniform oversight over how vaping products are manufactured and the lack of research done to determine whether vaping is safe. When life insurance companies determine rates, the best/lowest cost classification for a healthy smoker or vaper is Preferred Smoker or Preferred Tobacco.

Unfortunately, the "Preferred Smokers" rate often is more than four times higher than the best preferred non-smoker rate class. For instance, the average monthly premium for a 35-year-old male classified as Preferred Tobacco with a $500,000, 20-year term life insurance policy is $108.72. That same applicant with a Preferred Non-Tobacco classification would pay $31.72.

Don't Lie about Vaping

If you vape, it doesn't pay to lie about your e-cig use. First, most life insurance carriers require applicants to take medical exams to qualify for a policy. Insurance companies may order tests such as blood, saliva and urine analysis in order to determine whether nicotine is present in your body and whether the source is actual cigarettes or e-cigarettes.

Second, if you misrepresent your nicotine usage, and it's discovered during the "contestability period" that you were a vaper before you died, the life insurance company may refuse to pay the death benefit to your beneficiaries. This rule applies even if you weren't killed by tobacco or nicotine use. Or, the carrier may pay your heirs, but reduce the amount of the death benefit by the amount you would’ve been paying in premiums as a Preferred Smoker.

If you are a vaper and want a better life insurance rate, your best bet is to stop vaping completely. Most insurers want to see that you're nicotine-free (no vaping, cigar use, chewing tobacco or cigarettes) for a specified period, which can range from 12 months to five years.


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In this issue:

This Just In...

How Life Insurance Works in Divorce Settlements

Life Insurance and the High Cost of Vaping

Retirement Financial Planning: How to Set Realistic Goals

How Accident and Disability Insurance Differ


The information presented and conclusions within are based upon our best judgment and analysis. It is not guaranteed information and does not necessarily reflect all available data. Web addresses are current at time of publication but subject to change. SmartsPro Marketing and The Insurance 411 do not engage in the solicitation, sale or management of securities or investments, nor does it make any recommendations on securities or investments. This material may not be quoted or reproduced in any form without publisher’s permission. All rights reserved. ©2020 The Insurance 411. www.theinsurance411.com Tel. 877-762-7877.