Britain and the big, fat cost of cover

As obesity threatens to overtake smoking as the UK's biggest preventable cause of death, Melanie Bien looks at the penalties being imposed by insurers

Smoking has long been the main preventable killer in the UK. But that is changing. The Government estimates that it won't be long before obesity kills more people every year than cigarettes. Some eight million people are obese now, and by 2005 it is predicted that the condition will affect one in five men and one in four women.

Smoking has long been the main preventable killer in the UK. But that is changing. The Government estimates that it won't be long before obesity kills more people every year than cigarettes. Some eight million people are obese now, and by 2005 it is predicted that the condition will affect one in five men and one in four women.

Life companies are increasing premiums on their life assurance policies accordingly by calculating the applicant's body mass index (BMI). The heavier you are in relation to your height, the steeper your premiums will be.

For example, a 35-year-old non-smoking male of average height and weight – roughly 5ft 8in and 12 stone – would pay £8.60 a month for life cover with Norwich Union. But if he weighed 16 stone, the cost would leap by over 20 per cent to £10.80. If he weighed over 20 stone, the cover would cost £19 a month. These figures are calculated purely on size and are on the basis that there are no other health complications.

"It's a harsh reality but ultimately the cost of life protection for a higher-risk client will have to be met from the individual's pocket," says Philippa Gee, investment strategist at independent financial adviser Torquil Clark.

As well as increasing the risk of heart disease, hypertension, cancer and diabetes, obesity can ultimately cause early death. Obese people on average die nine years before their leaner counterparts, according to government figures. The fear is that standard life policies will no longer be offered to those classified as obese, resulting in more specialist cover and higher premiums. "If you are above the BMI, it could mean your premium will be 50 per cent higher than that of a standard policy," says Kevin Carr, senior adviser at life insurance broker Lifesearch.

"The incidence of obesity in the UK is on the rise," says Tony Jupp, chief underwriter for Norwich Union. "Over time, this may lead to fewer people being able to benefit from standard rates of life cover unless they embrace a change in lifestyle.

"We are in the business to insure people and the last thing I want to do is turn someone down. But if you are overweight, for insurance purposes you will be put in a pool of people exhibiting similar characteristics and you will have to pay for the higher risk."

Currently, obesity is one of a number of considerations when insurers work out premiums, though Phil Ost, a spokesman for Eagle Star, admits that if obesity becomes endemic, that could push up costs considerably. "It is becoming more of an issue. At the moment we factor it into the process of how we underwrite policies because it means people will have a predisposition to certain illnesses. We use a weight and height correlation and then look at individual cases."

While suspect applications are flagged up, it is recognised that the weight/height measurement is fairly crude as someone, say a rugby player, might be very muscular and of limited stature. This person would be obese theoretically but actually more healthy than his BMI suggests. Analysing applications on a case-by-case basis, looking at family history and lifestyle, gets round this problem.

But even if you are obese, it doesn't mean you should avoid taking out life cover because of the potential cost. The cover is essential if you have children and want to ensure they are provided for if something happens to you. It is also essential if you have a mortgage and want it to be paid off should you die.

The best advice is to scour the market for cover. Life firms have different approaches to obesity, and these are reflected in the premiums. Use insurance brokers to speed up the process; they will know the ins and outs of the market.

For example, Lifesearch's Mr Carr says Legal & General is not as harsh in interpreting the height and weight ratio as Scottish Provident. So if he were searching for a quote for someone who was obese, he would approach L&G first.

Torquil Clark offers 65 per cent commission cashback on each life policy it arranges, which works out at a cash value of around a year's worth of premiums in a one-off rebate. But you must keep the policy for four years, or some or all of the cashback may have to be returned.

Contacts: www.lifesearch.co.uk; Torquil Clark, www.tqonline.co.uk, 0800 072 3186.

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