Drinking, Smoking Or Ill-health Can Increase Your Life Insurance Premuims

If you have a family history of poor health or if you dink heavilyor are a heavy smoker you might be under the misapprehension that critical illness cover or life insurance cover may be extreamely pricey. A managing director at Norwich Union, Mr L, says this is rarelythe case, “Manyof thosesmoking, eating ‘too much or drinking will possiblyhide from protection for fear of being incorrectly penalised for their awfulhabits. Hence, they will most likely find that these importantforms of cover cost even less than they thought.”
Mr T a specialist re-insurer, says only 30twenty five per cent of the working population have life insurance cover and only 18  per cent havecritical illness cover, even though it is generally understood that if you are working and/or have a mortgage and dependants, this safety is paramount. Lots of people are taking prohibative risks.
If a person were to die their life insurance will pay out on death and with any luck will be enough to repay the mortgage, and/or provide any loved ones with financial security.  In the case of critical illness insuranceit administers a dividend and helps at this time.  Even though medicine is progressing all the time and people are getting better from life-threatening illness, they are more than likely unable to work temporarily or are forced to retire; this is when a tax-free cash lump sum can create the financial security wanted.
If a person does drink or smoke insurance premuims will be higher but they do vary a lot between one insurer and another. And  they also vary between critical illness cover and life insurance cover. Norwich Union doesn’t raise premiums until somebody is drinking the equivalent of 3.5 to 5 pts daily.  For a non-smoking 33year old, drinking less than 9 units per day, for 110,000 pounds of life insurance cover, the basic rate is 17.70 pounds per month.  If you drink between 40 and 60 units weekly it increases to 25.35 pounds per month.
In comparison, it will cost a 25 year old non-smoker 18.90 pounds per month for 100,000 pounds of CIC . For a smoker this goes up to 32.80 pounds monthly, but the premium only increases again if you smoke over 40 a day.
**A family history of conditions such heart disease or diabetes does not mean that the insurance payments will definitely be higher.  A 35 yr old teacher,  Mr X, comes from a family that has a lot of members suffering from high blood pressure although his sister and his mother and father do not. A little while ago, he and his wife took out life insurance and CIC with LifeSearch from Scottish Mutual, providing them with a cover of 145,000 pounds.  Their monthly premium costs 39.50 pounds and Mr Y was quite pleased that his families medical history didn’t alter what they pay.
A manager of Axa, Mr O, says if you can’t afford to do both, it is wise to cover your mortgage with life insurance and then acquire as much ciritcal illness insurance as is affordable.
 ”Everyone who can afford it should have critical illness cover,” he says. “If you’ve got dependants you should have life and critical illness cover. The only people who may not need critical illness are those with excellent, not just normal, employee benefits.”