If you've kicked your smoking habit in favour of vaping, you may be thinking you've made a solid choice in support of your health, but have you? Are e-cigarettes actually “safer” than traditional cigarettes?
The answer to this question may surprise you, and the effects on your insurance premiums may have you rethinking your new habit.
A study on tobacco use in Canada found that about 20 per cent of surveyed 15-24 year-olds have tried e-cigarettes at least once.1 — Statistics Canada, with support from Health Canada
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Why is it called vaping anyway?
E-cigarettes (a.k.a. electronic cigarettes) work by converting a liquid concentrate into a vapor that can be inhaled like a traditional cigarette. Hence why it's called “vaping” instead of “smoking.” The vapor dissipates quickly and leaves behind a subtle scent of whatever cartridge you've chosen (think mint or strawberry).
If you vape, you're part of a growing group: A study on tobacco use in Canada found that about 20 per cent of surveyed 15-24 year-olds have tried e-cigarettes at least once.1
But, as one of those 20 per cent, you might be wondering what the experts have to say about the health impact of vaping. E-cigarettes don't always contain nicotine, so many people consider them to be less harmful than traditional tobacco cigarettes, which typically do.
So, is vaping safe then?
Like your friend’s Facebook relationship status, it’s complicated. Whether or not nicotine is present, answering the popular question “is vaping bad for you?” requires knowledge about the vaping liquid itself. Its contents can vary from brand to brand, but a study found known cancer causing ingredients like lead, formaldehyde, and other carcinogens — the exact type of toxins some vapers may be hoping to avoid.2
Also, keep in mind that while some e-cigarettes may be less harmful than smoking cigarettes, “less harmful” isn't the same as “safe.” While Health Canada has been slow to regulate e-cigarettes, they've issued an advisory urging Canadians to avoid them due to their potentially hazardous health effects.
Will e-cigarettes really have an impact on my insurance costs?
As the nicotine content of e-cigarettes is highly variable, vapers are treated like smokers by many insurers, such as BMO Insurance.* (By the way, you're usually defined as a smoker if you've used a tobacco product within the last 12 months. Poached a cigarette off a friend in the last year? Hello, smoker.)
It's believed that people who smoke or vape are more likely to develop health issues and, potentially, pass away at a younger age than non-smokers and non-vapers. As a result, you'll most likely find yourself paying more for life insurance.
For example, if you were an otherwise healthy 31-year-old woman with a standard underwriting risk who uses e-cigarettes, you may pay $13.86 per month for a 30-year EasyTerm $50,000 life insurance policy. By comparison, if as that same 31-year-old woman you didn't vape, you may only pay $10.08 per month, a 37.5 per cent lower rate. Over 30 years, that number adds up — you'd fork out an additional $1,360 in additional premium payments.
(Want to know what an EasyTerm life insurance may cost you? Get a quote now.)
For larger policies, the additional cost of using tobacco or vaping products is even bigger. For a $200,000 policy, you'd pay $15.12 more per month, which adds up to an extra $5,443 over the 30 year-term of the policy.
Whichever type of cigarette you're into, you can expect higher insurance premiums until you're smoke-or vape-free, typically for one year. But if you are a vaper, you should pay close attention to how smoking is defined in different policies because they may vary.
If vaping is proven to be safer in the future, will my insurance costs be cheaper then?
Only time will tell. While traditional tobacco smoking has been around for centuries and studied for decades, e-cigarettes have only been on the market for about 10 years. So, you'll probably see new research, information, and possibly, changes to regulation in the future. Maybe you'll get lucky and scientific discoveries will prove that e-cigarettes lead to a lower mortality rate than tobacco. If that happens, you may see insurance premiums and rates change.
Also, if you smoke or vape when you sign up for life insurance and, as mentioned, you stop smoking/vaping typically for one year, you can declare yourself as a non-smoker and your rates may be adjusted accordingly (depending on your insurer).
Bottom line? When you're in the market for insurance — and looking to lock in the lowest possible rate — your best bet is to avoid tobacco and e-cigarette use altogether. The bonus? You'll experience the health benefits of a smoke-and vapor-free life. That's a win for your body and your wallet.
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1Propel Centre for Population Health Impact Special Supplement using data from the 2013 Canadian Tobacco, Alcohol and Drugs Survey (CTADS), conducted by Statistics Canada, with the cooperation and support of Health Canada, consisting of a random sample of Canadians aged 14 and over, using computer-assisted random-digit-dialed telephone interviews, between February to December 2013.
2Center for Tobacco Control Research and Education, University of California, San Francisco
These comments are general in nature and should not be construed to be legal or tax advice, as each client's situation is different.
Please consult your own legal and tax advisor.
*BMO Life Assurance Company