Since the life insurance industry started underwriting cigarette use some 30 years ago, the focus has largely been directed at two primary considerations

o Do you currently smoke?

o If you quit, how long have you been cigarette-free?

The Problem is, by limiting the questioning in this manner, underwriters ignore two additional aspects of cigarette use that are far more relevant to insurability.

In a 2009 tele-underwriting survey involving over 100 North American insurers and managed by my firm, 92% of chief underwriter respondents agreed that they get more truthful information about smoking by using tele-interviews than they once did with traditional history-taking via non-medicals, paramedicals and physician exams.

Given this robust consensus on the credibility of tele-interviews, it is likely that life underwriters will get equally reliable responses by going further with the smoking questions to get at what matters most.

The driver of cigarette-induced health consequences is not current use in a vacuum. Rather, it is aggregate exposure over decades to the literal “stew” of toxins. Excess mortality associated with this pervasive habit is due to cumulative toxicity, not the direct consequences of current smoking.

Bottom line: Current use pales by comparison with lifetime exposure as the main criterion for measuring smoking-related risk.

Ex-smokers who have accumulated extensive pack-years continue to manifest significant excess mortality long after they quit. This exposes the flawed nature of forgiving prior heavy smoking once the applicant attests to a relatively short interval of ostensible abstinence and has “passed” one last cotinine test (this measures a substance that remains in body fluids after a person has used nicotine).

Lung carcinoma is the leading cause of cancer death and, as everyone knows, the vast majority of cases are attributable to cigarette use. It is also one of the most common causes of death seen in the first few years that life policies are in force. Therefore, underwriters need to appreciate that pack-years smoking, whether the person is an ex-user or continues to consume cigarettes, is the key determinant of excess lung cancer claims.

If an applicant tells the insurer that he smoked 10 cigarettes a day for two years as a young adult, and then quit for six decades only to resume the habit during a recent period of bereavement, he would inexorably be classed as a “smoker.”

However, if this same individual had inhaled two packs each day over those six decades but stopped five years ago, he would constitute a “non-smoker” based on the prevailing criteria of just about every insurer.

How does the industry justify such paradoxical underwriting outcomes considering what the underwriters know about the relative risks involved?

All we need to calculate pack years are three things: when they started, how much– on average–they smoke per day and, if they stopped, approximately when they did so. Three simple questions yield the same credible pack-year count which physicians routinely use when taking histories from new patients.

The other matter of concern here relates to ex-smokers. Should underwriters routinely ask longtime cigarette aficionados why they finally walked away from the habit?

Common sense says that after mindlessly puffing away for decades, smokers don’t simply wake up one morning and say “egad, what a filthy habit!” Rather, the prime mover in giving up cigarettes after many years is most often a change–for the worse–in health status. Typical examples include increasing shortness of breath, sudden onset of disconcerting new symptoms or receiving a dreaded diagnosis of serious smoking-related illness.

Some proactive companies are already building these key questions into their routine tele-underwriting paradigms. In the aforementioned survey, over half of the respondents acknowledged that they now include at least one of the two essential pack-year questions, while 18% are asking ex-smokers why they quit.

If these practices become the norm industry-wide, life insurers will finally be able to do realistic assessments of the insurability implications of an applicant’s history of cigarette use. When this happens, the risk triage of both current and ex-smokers will be more appropriately carried off.

Hank George, FALU, CLU, FLMI, is president of Hank George, Inc., Greendale, Wisc. His email address is hankgeorge@aol.com.