Put Down That Cigarette: Here’s the Financial Impact of Your Smoking

Sep 10, 2018 | 2 months ago | Read Time: 3 minutes | By iKnowledge Team

Smoking is a habit that puts not only your health in jeopardy, but also your finances. Find out why a critical illness insurance is an absolute must for smokers.

Most of us already know the negative impacts smoking has on our health from the government and private campaigns that wax eloquent about how tobacco smoke is ruining our health. But we often forget to consider the financial impact this vice can have on our lives.

You spend over Rs. 36,000 a year (assuming the cheapest brand) to sustain your smoking habit. But this isn’t where the story ends. Think back to the gory commercials showcasing what tobacco smoke does to your lungs: lung cancer, cancer of the mouth and throat, asthma and other respiratory diseases. India accounts for 11.4% of the world’s smokers, according to a report published by the WHO. It causes over 6.4 million deaths every year. These numbers coupled with the ever-rising medical costs paint a dismal picture for your finances.

Quit Smoking

Source: Times of India

Even if you have a regular health insurance or term plan (which most Indians today do not), it is far from adequate when it comes to covering critical illnesses that smoking can cause.

What is a critical illness insurance policy?

A critical illness insurance policy is designed specifically to cover critical illnesses such as cancer, respiratory problems and cardiovascular diseases. A single plan may cover up to 6-12 diseases. A critical illness insurance is usually of two types: standalone and rider. The only difference is the period covered and the frequency of premiums paid.

How does smoking factor in?

Well, on an average, all health insurance plans have a significantly higher premium for smokers. This is because smokers are extremely susceptible to a variety of illnesses such as stroke, heart disease, cancer as well as complications in pregnancy and osteoporosis in women. When you think about the magnitude of these illnesses, it is evident why most companies charge a hefty premium on even the simplest of critical illness policies.

When you fill out a health insurance policy application, it usually asks you whether you smoke and if you have used tobacco in the last six months. Not reporting your smoking habits correctly to avail lower insurance premiums is known as insurance fraud and is a punishable offense.

About 15% of the aggregate health care expenditure in high-income countries can be attributed to smoking. India is catching up to these numbers with China, India, and Indonesia accounting for 51·4 per cent of the world’s male smokers in 2015.

What can I do?

If quitting is not an option, the next best thing would be to insure yourself against the diseases that smoking brings with it. There are a number of good critical illness covers such as Aegon Life’s iCI Rider and its iCancer plan that give you a greater cover and higher sum assured.

As a smoker, it is advised that you get a critical illness policy early in life, so the sum paid by you is low.

In  case if  you are a heavy smoker who has already developed several health issues and still haven’t taken a health insurance, can you still take a cover? The answer is a resounding YES! Although, the premium you are charged will be on the higher side, and there will be a waiting period before your pre-existing diseases are covered, it will save you a lot of money that you would otherwise incur in paying hospital bills.

Alternatively, a critical illness cover is a good option if you find yourself in an emergency situation with little to no finances to cover your treatment.

Financial security and your health go hand-in-hand. If you plan your finances right and insure yourself early, even critical illnesses like cancer cannot deter the emotional and financial life of your family. But for this it is important that you admit to your vices and recognise the adverse effects it might have on your lifestyle. Make an informed choice by studying about the various insurances available online.

Advt. no.: II/Jul 2018/4239


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