Life and health insurance for smokers and vapers in NZ

What counts as smoking or vaping to life and health insurers?

Insurers ask whether you have smoked or used nicotine in the past 12 months, and their definitions run wider than cigarettes. Vaping counts as smoking at most providers on Policywise's panel. Several providers also count nicotine gum and patches, and at least one names chewing tobacco specifically. So someone who has never touched tobacco but vapes or uses nicotine replacement can still be rated as a smoker.

The 12-month look-back applies across every provider on Policywise's panel. Most publish this in citable form. Whether nicotine-free vaping counts differs between them, and at least one also names cannabis, which can carry its own loading above about one use a week.

Does vaping count as smoking for life insurance? Yes, at the providers whose published wording names it directly. Does vaping count as smoking for health insurance? Yes, on the same 12-month test.

Health New Zealand's position is that nicotine vaping is less harmful than smoking, and that nicotine itself does not cause cancer, lung disease, heart disease, or stroke. Insurers price the two the same regardless. Nicotine pouches sit in a further gap, regulated separately and named in no published definition yet.

Life insurance for smokers and vapers

Smokers and vapers can buy life insurance in New Zealand: the effect shows up in your premium, not your acceptance, and in which discounts you qualify for. Providers on Policywise's panel offer cover to smokers at smoker rates, once underwriting is complete.

Can I get life insurance if I'm a smoker?

Yes. Smoking questions feed the premium rate, not an acceptance decision, on the policy wordings we reviewed. You answer the smoking questions, you are underwritten like anyone else, and you are quoted at smoker rates.

If you have been declined elsewhere, at least one insurer's guaranteed-acceptance funeral cover offers a fallback between ages 50 and 80, with no medical questions and no smoker rating at all.

How does smoking or vaping affect your life insurance?

Smoking affects life insurance mainly through price. You are quoted from a smoker rate table rather than a non-smoker one, so the same cover costs more at the same age, sex, and occupation. It also changes what you have to disclose, and which discounts you can qualify for.

• The discounts you can earn: Some providers publish non-smoker discounts of between 7% (life cover only) and 15% (life and trauma cover). Both also require a healthy BMI (body mass index), so neither is a clean smoker versus non-smoker price gap.
• When they are assessed: At least one provider assesses its discount solely at application, never retrospectively, so quitting afterwards does not earn it.
• What you must disclose: Anything that could affect the insurer's decision to insure you, and anything that changes between applying and cover starting.

Beyond those percentages, no New Zealand figures exist for how much more smokers pay. A 'smokers pay two to three times more' claim on a comparison site is not sourced to any New Zealand insurer.

What happens to your life cover when you quit smoking or vaping?

Nothing happens automatically. Once you have been smoke-free and vape-free for 12 months, you can ask your insurer to reclassify you as a non-smoker and reduce your premium. Where a provider's wording states an effective date, the reduction applies from a future date and is not backdated; the exact trigger date varies by provider.

• The route is generally a signed declaration rather than a medical test, accepted by phone or online portal with some providers. Every month you wait before asking is a month at smoker rates.
• A level premium may not move at all. The commitment that keeps your rate level also stops it changing for a change in circumstances. At least one provider commits in writing that rates won't change for a change in circumstances after cover starts, which cuts both ways. Check before choosing level premiums if you plan to quit.
• An existing exclusion is not automatically lifted by quitting. Insurers typically review any exclusion against medical evidence about the condition itself, not a change in habits.

Ask your Policywise adviser whether that applies to your policy.

Health insurance for smokers and vapers

Health insurance treats smoking less consistently than life insurance does. At least one provider prices smoking and vaping into the base premium, others offer a non-smoker discount instead, and on at least one provider's health cover the premium may not change at all.

How smoking and vaping affect your health cover

Smoking usually affects what you pay rather than what you are covered for: some providers build it into the base premium, others offer a non-smoker discount instead, and on some plans it makes no difference at all.

• Built into the rate: It comes alongside age, gender, and excess, with at least one provider.
• Offered as a discount instead: One provider gives 10% for up to two years from joining; another gives 10% on selected adult plans, with group scheme members excluded.
• Not adjusted at all: At least one provider says health premiums may not be affected by a change in smoking status.

On at least one insurer's health cover, a condition already caused by smoking is handled as a pre-existing condition, not a smoking penalty. Its pre-existing-condition categories aren't defined by cause, so pre-existing-condition exclusions apply regardless of whether the condition was smoking-caused.

Having pre-existing conditions doesn't mean you can't get cover at all, or that they will automatically be excluded. Health insurers may cover some pre-existing conditions if you meet specific criteria, or set a waiting period before covering them.

What happens to your health cover when you quit smoking or vaping?

Whether your health premium drops when you quit smoking depends on the provider. For some, it makes no difference at all. Others instead offer a one-off joining discount for non-smokers, and with these, quitting later won't qualify you for anything, since the discount was only ever available at sign-up.

• Where premiums are smoker-rated, you need a signed declaration, 12 months of continuous cessation, and an insured person aged 21 or over.
• Where it is a joining discount, it is open only to new members and cannot be revised after applying. An existing member who quits cannot newly qualify.
• Some discounts are not automatic. You have to tell your insurer, and it then shows on your renewal notice. At least one provider assumes non-smoker where it holds no record.
• At least one provider helps you quit, covering quit-smoking programmes up to $100 a year as part of an optional add-on, and another covers smoking-cessation consultations through its GP services benefit.

How smoking or vaping impacts other types of insurance

Smoking and vaping affect more than life and health cover. Trauma cover is smoker-rated by several providers, and so are income protection and total permanent disability cover.

Mortgage protection is inconsistent, and group cover arranged through your employer often does not price your smoking.

Trauma (critical illness) cover has the strongest link, because smoking is a leading risk factor for the conditions these policies pay on. It is the greatest risk factor for lung cancer; a 20-a-day smoker is around six times more likely to have a stroke, and tobacco kills approximately 4,500 New Zealanders a year.

Quitting cuts that risk quickly. After a year smoke-free, the risk of heart attack and stroke is about half that of someone who continues to smoke. Having these risk factors does not mean you will develop any of these conditions. People with none develop them too, and many long-term smokers never do. At least one provider extends its non-smoker discount to trauma cover.

Income protection and disability cover are smoker-rated at several providers, with at least one carrying the same 12-month cessation clause as its health products.

Mortgage protection varies. At least one provider's mortgage protection carries the same smoking-status pricing across both its trauma-cover component and its core repayment cover. At least one other provider's mortgage protection says nothing about smoking at all.

Group and workplace cover often does not price your smoking, on the schemes Policywise reviewed. One insurer's employer-arranged group life, trauma and income protection policies never mention smoking, and another's employee scheme rates on age, sex, occupation, income, and loadings rather than smoking status, both with no individual health evidence inside the automatic acceptance limit.

Two catches, though: one health insurer bars group scheme members from its non-smoker discount, and at least one insurer's continuation option can make smoking an individual rating factor once you leave and keep the cover going.

How to compare cover as a smoker or vaper and get cheaper rates

Compare what varies between providers, not just the headline price, and you can bring your own rate down by quitting and asking to be reclassified. The differences that matter are the definition of smoking, whether smoking sets your rate or only a discount, how that discount is earned, and how easily you can reclassify once you quit.

What to compare:

• The substance list: Whether nicotine-free vaping, nicotine replacement therapy, or cannabis counts.
• Rate or discount: A smoking-rated premium moves when your status changes. A joining discount is fixed at application and gone if you miss it.
• The reclassification pathway: Whether there is a published mid-policy route, and whether it covers health as well as life cover.
• Premium structure: On some stepped-premium policies, a smoke-free re-rate can flow through at the next anniversary, though starting to smoke typically affects only new cover you apply for, not cover you already hold. At least one provider commits in writing that rates won't change for a change in circumstances after cover starts, which cuts both ways. Check before choosing a level premium if you plan to quit.
• Excess and waiting periods: On at least one insurer's health cover, a higher excess usually means a lower premium. On at least one insurer's income protection, a longer waiting period costs less.

To bring the price down, most insurers offer some route back to non-smoker rates once you've quit, though the process and timing vary by provider. Check with your insurer or adviser.

Quitline is on 0800 778 778, or text 4006, and local Stop Smoking Services provide free nicotine replacement therapy and vape kits. But patches, gum, and vapes count as smoking with most providers, so your clock only starts once you stop those too.

There is no single best insurer for smokers, because providers diverge on most of the points above.

How long do you have to be smoke-free to get non-smoker rates?

Twelve months, at every provider on Policywise's panel. No provider was found using a shorter or longer window, though on some health plans the discount is joining-only, so no amount of smoke-free time helps an existing member.

• Nicotine replacement counts. Patches, gum, and vapes sit inside several providers' definitions, so the clock starts when you stop those, not when you stop cigarettes.
• The clock runs to the date you declare, not the date you quit. At least one provider's form states that non-smoker rates assume no smoking in the 12 months before the declaration. It's worth asking as soon as you've cleared 12 months, since the reduction isn't backdated.

Public health uses a different measure. Officially, you count as an ex-smoker after 28 days. No insurer accepts that version.

How to change your insurance from smoker to non-smoker

Many insurers let you apply for a non-smoker declaration once you've been smoke-free and vape-free for 12 months, and your premium adjusts from a future date once it's approved. The evidence is generally a signed declaration rather than a medical test.

• Wait the full 12 months, including any nicotine replacement therapy, for most insurers.
• Ask for the declaration form. Providers name it differently, and at least one provider takes the change by phone or online portal instead.
• Sign and return it to your insurer.
• Check the effective date and your next bill. The reduction runs from the next premium due date after approval for some insurers, or the next billing date for others; it is not backdated at the providers whose wording states an effective date. On some plans, a discount that is not automatic should appear on your renewal notice .

Two cautions, though. A declaration that later proves untrue lets providers reduce your cover or void the policy from inception. On some health cover there may be no mid-policy pathway at all.

What happens if you start smoking or vaping after your policy starts?

At least a couple of providers commit in writing that starting to smoke won't increase what you already pay, though it isn't a guaranteed industry-wide rule. Some insurers re-ask the smoking question if you increase your cover.

• Two providers commit in writing. One won't change rates for a change in health or personal circumstances after cover starts. Another states that starting to smoke affects new cover increases rather than cover you already hold.
• The ongoing duty is described differently. One ties it to extending, varying, or reinstating your insurance. Another describes a broader duty if circumstances change during the term. It's worth reading your own policy to see which duty applies.
• If you declared yourself a non-smoker and then started again, you are in a sharper position. Your earlier declaration may no longer be accurate, and providers warn a false or outdated declaration can be grounds to alter or void a policy.

Will your claim be paid if you smoke or vape?

Yes, if you disclosed it. No smoking-specific claims exclusion was found in any New Zealand policy wording surveyed, so on the wordings surveyed across Policywise's panel, smoking itself does not appear to void a policy or bar a claim. What does put a claim at risk is failing to disclose your smoking honestly when you applied.

Under current law, the remedy for non-disclosure of material information is to avoid the policy back to the beginning, and the law does not distinguish innocent from deliberate non-disclosure. Many providers' wordings carry similar powers: declining a claim and voiding it from the commencement date. At least one can also alter benefit terms or recover benefits already paid.

In practice, it is usually less severe. Insurers sometimes take the action they would have taken had they been told, reducing the cover, increasing the premium, or adding an exclusion.

In one real case, a trauma and life claim was initially avoided over an undisclosed teenage colonoscopy and anaemia diagnosis, then settled on the reduced cover that would have been offered, paying the beneficiary $95,664 rather than nothing.

In another, a life claim could have been declined over undisclosed diabetes, cholesterol, blood pressure, and asthma, but the insurer instead made a reduced payment plus $10,000 in goodwill.

Parliament has passed reform requiring proportionate responses rather than outright cancellation, and deliberate dishonesty rather than accidental non-disclosure before a claim is declined on that basis. It is not yet in force. If you are unsure whether your application declared your smoking correctly, raise it now rather than at claim time.

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