Smoking can be costly for your finances as well as your health.

Published January 2021

In spite of the known health risks, the graphic photographs and warnings on cigarette packages PLUS the high price of buying cigarettes, smoking is a famously hard habit to break. If you didn’t already have enough incentive to quit, consider this: smokers pay more when purchasing life insurance too. How much more? A lot. Some companies charge from 30% to 300% more!1

The chart below represents the monthly premiums for smokers and non-smokers by age and was calculated using the online calculators of some large insurance companies in Canada. These costs are based on a male receiving $100,000 of 10-year term life insurance coverage.1

Age Non-Smoker Smoker
18 $12.09 $16.54
25 $12.09 $16.64
35 $12.82 $21.08
45 $20.18 $42.94
55 $40.98 $99.29
65 $114.26 $250.78

Why such a big difference? The well-documented health risks of smoking in turn affect the monthly rates you pay. Most people know that smoking increases the risk of lung cancer, but may not know it also increases the risk for 15 other cancers, including stomach, colon and ovarian cancer, according to the Canadian Cancer Society.2 The overall life expectancy of smokers is less than that of non-smokers as a result, which is why insurance companies charge smokers more.

What if you quit?

Good for you if you have quit smoking or plan to! That can help you keep a lot more money in your pocket. Expect your life insurance costs to stay high for a while after you quit, before starting to decrease, but rest assured they will go down. FYI, to be considered a non-smoker, an insured person cannot have used any form of tobacco or tobacco cessation products in last 12 consecutive months1

What if you only smoke socially?

It’s the same difference to an insurance company if you only have a cigarette or two in social situations no matter how infrequent. Smoking is smoking and you’ll pay more for coverage.1

What if you vape?

Great question, and one a lot of people are wondering about. The problem is that the contents of e-cigarettes are different from brand to brand and can contain some or all of the same toxins as traditional cigarettes. Health Canada has issued advisories relating to e-cigarettes, and many insurance companies view it as being the same as cigarette smoking. In other words, an increased risk, which equals an increased cost to insure.1

What about smoking marijuana?

Now that cannabis is legal in Canada, many people are asking the same question. Though many insurance companies have updated their positions on cannabis and do not view marijuana as the high-risk factor that cigarette smoking is, it’s still not without its risks, and so likely to somewhat increase your cost to insure. It’s best to ask the insurance company you are thinking of dealing with what their policy regarding cannabis is and what your cost would be.1

How do insurance companies find out if I smoke?

Not telling an insurance company that you smoke or smoked when you apply for coverage can have an impact on the final benefit. They will find out, and they use various ways to verify the medical information you provide:

  • Medical exams and questionnaires
  • Pharmaceutical records
  • Past insurance policies
  • Social media audits3

There are lots of reasons to quit smoking: the cost of your habit, the possible cost to your health and its toll on the health care system in Canada, the cost to your loved ones, and the cost you pay to protect them, with life insurance.

For more information or to get a quick online quote for CAA Term Life Insurance


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