Wednesday, March 19 14:04:12
Mortgage holders who smoke could be paying over E20,000 more than non-smokers on mandatory life assurance premiums over the lifetime of their policy.
Figures released to mark the tenth anniversary of the introduction of the smoking ban this month, show that on average, smokers pay 70pc more in mortgage protection insurance than their non-smoking counterparts.
The research compiled by Low.ie compares mortgage protection insurance premiums for smoking and non-smoking couples across a range of mortgage values and age demographics.
The low-cost insurance broker says smokers pay thousands of Euro more than non-smokers on mortgage protection.
Peter O'Reilly, Managing Director of Low.ie explains that the extra paid by smokers in all categories is very significant: "Even a mortgage of E140,000 over 25 years would cost a 35 year old smoking couple E3,430 more than non-smokers; if they were in their early 40's the extras would increase to E9,788. If they were in their early 50's with the same mortgage for just 20 years, they would pay an extra E23,626."
"A couple in their mid-30's with a 30-year mortgage of E250,000 will pay an extra E8,384 over the lifetime of their premium if they smoke. If the same couple were in their early 40's that would increase to E20,330 extra"
"Mortgage protection premiums are calculated based on the mortgage holder's age, the mortgage value and the duration of the mortgage - and on whether or not the mortgage holder smokes."
O'Reilly says the tenth anniversary of the smoking ban is a good opportunity for smokers to reflect on the financial benefits of quitting as well as the health benefits. "This is one of those mandatory insurances. Simply put, mortgage protection is there to cover the outstanding mortgage in case of death. The figures show that smokers will pay a lot more. However, the good news is, smokers who manage to quit, will be considered a non-smoker, after 12 months have passed."