Smokers paying up to twice as much for life assurance

SMOKERS ARE paying more than just the price of a packet of cigarettes for their habit and it could be costing them nearly €15,000 in higher life assurance payments, according to a study published by the National Consumer Agency.

The study, published yesterday, shows that smokers are being asked to pay up to twice as much as a non-smoker for a life assurance policy which offers the same level of cover; and that they can save more than €13,000 over the life of a policy if they give up smoking.

The cost comparison also highlights that consumers can make significant savings by switching provider.

“If giving up smoking is your new year resolution, bear in mind that as well as the immediate savings you’ll make, you could also cut thousands off the long-term cost of your life insurance policy, once you’ve been a non-smoker for 12 months,” the agency’s director of public awareness and financial education, Karen O’Leary, said.

The cost comparison shows that there are a number of other ways to reduce the cost of life and mortgage protection insurance.

It advises consumers who have given up smoking in the new year to contact their insurer to notify them and ask for a review of their premium. Depending on the provider, they may have to wait for up to 12 months to be considered a non-smoker, but the savings can be substantial. For example, a 30-year-old man with a €320,000 term life policy would reduce his premium with his current provider by as much as €32 a month if he gave up smoking. If he then switched to another provider, he could cut his premium by a further €5 a month. This represents a saving of more than €13,000 over the 30-year term.