The vaping industry has come under fire after a string of deaths in the US in 2019, causing global reinsurers to issue warnings to life insurers about underwriting young vapers. However, regulation varies significantly across countries, suggesting that some may be at greater risk than others.

Reinsurers including Hannover Re and Swiss Re issued a warning to insurers to be extra cautious when underwriting young vapers, especially those who are using tetrahydrocannabinol (THC). This is due to many of these products also containing vitamin E acetate, which officials from the Centers for Disease Control and Prevention have identified as a “very strong culprit” in lung-related injuries. According to GlobalData’s 2019 UK Insurance Survey, 32% of adults between the ages of 18 and 25 vape, but the products that are accessible are different from their US peers.

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Vaping in the UK is more heavily regulated than in the US. Products that contain THC or cannabis oil are available in some US states, but these are not allowed to be sold in the UK. This is likely the main reason there have been no confirmed deaths linked to vaping in the UK. The state of regulation in a region is therefore a key element for insurers to consider when underwriting policies.

The UK’s stricter regulation of the vaping industry is one of the reasons that UK health authorities can maintain that vaping is 95% healthier than smoking. This has led to a few insurers offering discounts for people who vape as opposed to using traditional cigarettes. While the long-term health effects of vaping are not yet clear, the UK’s regulation has allowed new insurance products to enter the market, segmenting the customer base further and potentially allowing for more accurate underwriting.

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