Understanding life insurance

‘Not humanly possible’: Driving instructor allegedly hacked auto insurance computers
August 23, 2019
ICBC asking drivers & parents to keep kids safe as school returns
August 29, 2019
Show all

Understanding life insurance

family, transport, safety, road trip and people concept - happy parents talking to little girl in baby car seat

Submitted

BC Local News

Life Insurance… Have you ever thought of how much impact smoking has on your finances? Health Canada’s cost calculator finds that smoking half a pack a day can cost up to $2,500 per year. Meanwhile, on a nationwide scale, the Canadian Cancer Society reported that smoking generates $6.5 billion in healthcare costs yearly. And, the expenses don’t end there – not if you’re looking to get life insurance.

What does life insurance have to do with it? Your life insurance rate depends on how healthy you are right now. But it also depends on whether you’re putting your health at risk with lifestyle choices like smoking. Here’s how this costly habit can affect your life insurance premium.

How smoking can affect your life insurance premium

To start, let’s look at the basics of life insurance. You buy a policy that provides financial protection and pay for it with monthly or annual fees, called premiums. What happens if you die while the policy is still active? Your beneficiaries get a specific amount of money stated in the policy, known as the death benefit. They can then use that money to help pay off debts, mortgages, loans, and other living expenses.

Basically, life insurance can help give your family financial assistance and security after you die. So, how do insurance companies put a price on that security? A lot of the cost of life insurance depends on your current state of health and your family history. But what’s one of the biggest factors insurance companies look at when assessing your health risk? Whether or not you’re a smoker.

“The health hazards of smoking and the risks it puts on your life are well-known,” says Paula MacMillan, a financial advisor from Winnipeg.

Underwriting is when an insurance company reviews your health risks after you’ve applied for life insurance. This process lets an insurer calculate the coverage you’re eligible for. It also ensures your premium reflects the level of risk.

Simply put: Your risk level affects your premium.

“Being a smoker puts people at a higher risk of smoking-related illnesses,” Macmillan says. “And this translates to higher premiums.”

READ MORE HERE

Looking for auto insurance as a high risk driver in Ontario? Get an instant quote from the car insurance professionals. Contact The High Risk Auto Pros today, get back on the road with an instant auto insurance quote. 

Admin
We offer high risk insurance solutions no matter your situation. Whether you’ve been involved in a car accident, gotten tickets, convictions or received a non-payment cancellation or non renewal by your current insurer, we’ve got the solution for you.