Why do individuals lie about their smoking habits on the insurance application form? To benefit from lower premium rates? Or maybe to maintain eligibility for an insurance policy? But are there no ramifications of lying to the insurance company? Of course there are! In this article, we will look at why you shouldn’t lie to your insurance company about your smoking habits and what are the consequences if you do.
Failure to disclose about tobacco use is one of the most common lies in an insurance application. Given that premiums rise by 25-50% if one consumes tobacco, it can be quite tempting to say that one does not smoke to keep it low. If you are a smoker, do not lie about your smoking habits to your insurance company. You may think the lie is no big deal, but what you don't realize is that you are putting the insurance benefits at stake.
Who is regarded as a smoker by an insurance company?
An insurance company will list you as a smoker if you answer yes to the question of smoking on your insurance application form. A smoker is someone who uses tobacco or nicotine in any form - be it cigarettes, cigars, nicotine patch or chewing tobacco. Whether you regularly use nicotine products or you smoke occasionally, your answer should be yes in the form, as by insurance standards, you are to still be regarded as a smoker.
If you, a potential client, have given up smoking then you can avail non-smoker insurance quotes from insurance providers. To benefit from the lower premium rates, you have to quit the habit for at least 2 years.
What happens if the insurance company finds out you are lying?
If you smoke, it is not a wise move to lie about it. Insurance companies have ways of finding out whether one has lied or hidden facts on their application form. During the medical tests, if the insurance company gets to know that you have lied about nicotine or tobacco use on your application, the policy could either be revoked or the insurance company may refuse to pay the claim amount. The ethically right thing to do here is to tell your insurance company the truth while applying for a policy, so that there is no chance of material misrepresentation.
Be honest with your insurance company from the very start and accept the fact that if you are a smoker you will be asked to pay more for your policy. The reason we have an insurance cover in the first place is to protect our near and dear ones financially, should anything unfortunate happen to us. Lying to the insurance provider puts the financial security of our family at risk.