Life insurance jeopardised by excessive alcohol and drugs
consumption, declares Moneynet
Insurers are taking a hard line on drinkers and hard drug users,
as new research from Moneynet shows that
exceeding 40 units of alcohol a week can result in a 50 per cent
rise in life insurance premiums. And, for drinkers whose
fondness for a tipple runs into the 90 units* a week, premiums
are likely to be loaded by some 300 per cent, although
surprisingly they are not turned down outright and can still get
cover at a price. To be declined outright by most insurers they
must be exceeding 98 units of alcohol per week!
Whilst insurers can make life financially uncomfortable for
regular, above average intake drinkers, users of the really hard
stuff - Class A drugs such as cocaine and heroin - may find they
cannot get life insurance at all.
"Life insurance firms have been really tightening up their act,
and users of hard drugs such as cocaine or heroin will be
declined outright for cover unless they have been clear for at
least three years," said Richard Brown, Moneynet's Chief
Executive.
"After the applicant has been 'clean' for the three years, most
insurers will still impose an additional 200 per cent loading -
more or less the same criteria applied to someone who has
previously had a heart attack," he added.
"Another interesting point here is that habitual users of
sleeping tablets can also be declined for cover until they have
been clear for at least three years," said Brown.
"Life companies now request applicants fill in their forms very
assiduously, and payouts will be refused if the applicant is
found not to have declared their drug or alcohol usage."
Recreational cannabis or marijuana users are invariably accepted
for life insurance, although typically at smoker rates (see
table). Smoker loading rates tend to be around 60 per cent," he
said.
"As with any financial product it is important that customers
don't take the first quote, as prices can vary significantly
from one insurer to another. In addition, where someone has a
particular problem such as drug or alcohol abuse or even a
history of illness, some insurers may be more sympathetic than
others and impose a lower loading," added Brown.
* 1 unit = half a pint of beer or a standard sized glass of
wine, according to BMA (British Medical Association)
classification
Life insurance quotes
Life insurance consumer guide
* * * * * * * * * * * * * * * * * * * * * * * * *
About moneynet:
Moneynet.co.uk is the
UK's most established personal finance research and data
website. The company offers consumers a wide range of low cost
financial products: from mortgages and person
al loans; to car, home and medical insurance; credit
cards; savings accounts and best-buy fixed rate products.
Moneynet.co.uk is an ethical, impartial and comprehensive source
of consumer finance information, covering the whole of the
personal finance sector.
Moneynet was founded in 1997 by Chief Executive Richard Brown to
simplify the personal finance market and provide consumers with
impartial and interactive information on financial products and
services.
Press and consumer enquiries:
Moneynet
Contact: Richard Brown, Chief Executive
Telephone: 0208 313 9030
E-mail: online@moneynet.co.uk
Web: moneynet