World No-Tobacco Day: Why smokers have to pay higher premium for health insurance

It is often believed that health insurance companies tend to deny coverage to smokers and tobacco users. Contrary to the belief, health insurance companies provide cover for smokers but at higher premiums and with different terms and conditions.

Even though the premium is high for smokers, it should not prevent one from getting a health insurance as smokers are more likely to get lifestyle diseases than non-smokers.

A recent survey by ICICI Lombard ahead of ‘World No-Tobacco Day’ has revealed that 81 percent of smokers are willing to pay extra 20 percent on premium for their smoking habits, signifying that they found it difficult to quit the habit, Outlook Money reported.

World No-Tobacco Day is observed on May 31 every year to spread awareness about the ill-effects of smoking and to encourage people to quit tobacco use and adopt a healthy lifestyle.

Apart from being a health hazard, tobacco use harms the environment as well. According to the World Health Organisation (WHO), 600 million trees are felled annually and 22 billion tonnes of water is used to make cigarettes, which release 84 million tonnes of carbon dioxide into the air.

Over 8 million people are killed every year due to the use of tobacco, the United Nations said on Tuesday on the occasion of World No Tobacco Day.

Health insurance companies ask an individual about their smoking habits while signing up for a plan. Most insurers ask if the individual smokes and if they have smoked in the past six months. A person who uses nicotine in any form is defined as a smoker by health insurance companies.

Insurers conduct medical tests prior to issuing a cover to determine the premiums for coverage. For regular smokers, traces of nicotine can be found in the blood, urine, hair, and saliva. Insurers insist on taking medical tests if the individual has declared their smoking habit to ascertain his or her health condition before deciding on the premium.

The premium depends on the state of the individual’s health. Insurance also depends on the seriousness of pre-existing lifestyle diseases like hypertension and diabetes. At times, insurance companies deny cover to smokers with Type 2 Diabetes. They also deny cover to those who smoke over 20-40 cigarettes a day.

Smoking can cause a number of health problems such as lung infections and cancer. As this makes smokers a higher risk to the company for future claims, they charge a higher premium. However, this should not deter a person from disclosing the habit while buying an insurance cover. Higher premium is better than the huge hospital bills that the individual may have to pay if they fall sick.