Why Vaping Is Having Such An Impact On Insurance Underwriting

In Industry News, Insurance, Protection by Tom McGuinness

The UK is regarded as one of the most “vape-friendly” countries in the world, having embraced the e-cigarette trend as a much safer alternative to smoking.

Indeed, according to new figures from anti-smoking charity Action on Smoking and Health (ASH), an estimated 3.2 million in Britain now use e-cigarettes or vapes. Among those who vape, more than half (60%) have made the switch having given up cigarettes completely, while the remaining 40% are currently using e-cigarettes to help them quit smoking.

Public Health England (PHE) says that vaping is up to 95% less harmful than smoking traditional cigarettes, which is why health officials in the UK are so keen to push e-cigarette use and reduce the number of people in the country who smoke.

[Related reading: MPs Urge Government To Consider Relaxing E-cigarette Laws]

Another area where vaping is also having an impact is the world of insurance and underwriting. In fact, at the recent UnderwriteMe Forum – an event that saw representatives from 13 insurance and reinsurance companies come together – vaping was cited, along with wearable tech and genetic testing, as one of the top three evolving lifestyle changes that will influence future protection underwriting.

Vaping Presents Challenges For Underwriters

Steve Baldry, director of underwriting at UnderwriteMe, said that vaping is growing in popularity and this presents a number of challenges for underwriters because e-cigarette use falls outside the traditional ‘smoker’ category.

“With increasing numbers of people adopting this form of nicotine delivery and with little research to show what, if any, effects on health it may have, underwriters are being challenged to make decisions with little information,” he said. “This means they are keeping a very close eye on any developments, in terms of numbers of people vaping and any findings about its impact on health”.

In addition to discussing the impact of vaping, genetic testing and wearable tech on the underwriting industry, the forum also talked about how there is a need for insurance companies to simplify underwriting questionnaires and shorten declarations to improve the customer journey.

At present, it can take anywhere from under 30 seconds to several minutes to read declarations out over the phone – something that intermediaries, like ourselves, have to do.

Baldry also used the event to call for more work to be done on questions relating to the highly sensitive issue of mental health, saying how they should be framed and asked over the phone is vitally important when dealing with this often taboo subject.

Ensuring customers always got fair prices was another theme discussed at the forum.

As the UK continues to embrace vaping, and more people adopt the practise as an alternative to smoking traditional cigarettes, it is only right that the protection industry should closely follow this trend. After all, vaping is showing no signs of slowing down and e-cigarette users cannot and should not be tarred with the “smoker” brush when it comes to providing them with protection.

Tom is the Sales Director for Premier Choice Group. In his role, Tom oversee’s growth across all areas of the business while maintaining a small number of his own clients. At Premier Choice, Tom and the team deliver a unique, personal service to every client, while growing the business and maintaining a strong reputation as the UK’s best intermediary.