In case you haven’t heard, a new trend is bringing nicotine back in a big way. The industry of vaping and e-cigarettes has exploded, just as tobacco usage among adults and teens has hit an all-time low.

Fans of vaping claim it’s much healthier than smoking. Others think these fun-flavored “e-cigarettes” are risky and hooking a new generation of tobacco users. Last May, the FDA came down hard on e-cigarettes with a tough new set of regulations.

So who’s right, and how does all this affect your insurance policies?

What’s Vaping?

“Vaping” is a slang term for vaporizing something you’d typically smoke (like tobacco). A conventional cigarette heats the tobacco to the point of combustion and the user inhales the smoke. An e-cigarette doesn’t use fire and doesn’t produce smoke. Instead, a tiny metal coil heats a liquid known as “e-liquid” or “e-juice” to its boiling point. The active ingredients are then inhaled as water vapor.

The “e-juice” or “e-liquid” contains a blend of nicotine, water, glycerin, propylene glycol, and flavor. There are thousands of flavors for vapes and e-cigarettes. Some accuse makers of super-sweet flavors—like “gummy bear” or “cotton candy”—of targeting kids. Flavors can also be sophisticated and adult, with elements like black tea, anise, cloves, or coffee.

E-cigarettes produce huge, eye-catching clouds of this tasty vapor. Better yet, it won’t make your ­­clothes or breath smell, and there’s no litter from butts.

Vaping was only introduced to the US in 2007, but the market tripled every year to 2014. A 2015 poll found that one in 10 Americans now vape. Seventy percent of those vapers started in the last year. Most choose e-cigarettes because they’re supposedly healthier than real cigarettes, but is the hype justified?

Is Vaping Healthier than Smoking?

That’s the million-dollar question. Or rather, the multi-billion-dollar question. The future of this booming industry hinges on the answer.

There are two prevailing opinions. Vape supporters believe vaping is healthier than cigarettes and helps people quit smoking. Critics claim there isn’t enough research to be certain, but consumers should be wary.

The argument behind vaping makes intuitive sense: it’s safer to inhale water vapor than smoke. Cigarette smoke contains over 7,000 chemicals. This includes 69 proven carcinogenic compounds. Cigarette smoke carries tar, formaldehyde, ammonia, arsenic, and lead. On the other hand, e-liquid contains five ingredients. These are inhaled as a gentle cloud of water particles.

“The argument that the health groups keep making—that we have no idea what’s in these things—just isn’t true. We know a lot more about what’s in an e-cigarette than what’s in a tobacco cigarette,” says Michael Siegel, MD. Siegel is a professor at the Boston University School of Public Health and a prominent anti-smoking physician expert. He’s worked for decades to end tobacco usage. Now, he advocates for e-cigarettes.

“The majority of chemicals in tobacco smoke haven’t been identified,” Siegel continues. “We have no idea what’s in there… When you burn anything the combustion causes all kinds of chemical transformations. E-cigarettes are nowhere near as harmful because there’s no combustion. Of course, the second thing is that there’s no tobacco. You combine those two things and you’re going to have a much safer product, no question.”

But not all e-cigarettes are created harmless. FDA testing from 2009 found detectable levels of cancer-causing chemicals in leading e-cigarette brands. A 2014 study discovered formaldehyde in high-voltage e-cigarettes. There are many reports of inconsistency across the industry. The FDA found that e-cigarettes both across and within different brands had wildly different amounts of nicotine than labeled. Most of the 7,700 (and counting) e-liquid flavors are made in the back rooms of vape shops with little to no regulation. Oh, and sometimes e-cigarettes explode in the users’ hands or mouth.

Finally, e-cigarettes still contain nicotine. Nicotine is harmful to your health and highly addictive. This has doctors, lawmakers, researchers, and parents worried. Are e-cigarettes just a Trojan horse to get America smoking again?

When you look at young vapers, it sure seems that way. Teens and adolescents are smoking e-cigarettes at alarming rates, even as cigarette use is at an all-time low. In 2015, there were 3 million e-cigarette users under age 18. Only 1.6 million reported using cigarettes. A whopping 40 percent of teens who’ve tried vaping have never smoked a normal cigarette. E-cigarettes are still addictive. These numbers are troubling when one considers that 80 percent of adult smokers tried their first cigarette by age 18.

But are e-cigarettes dangerous on their own? The American Heart Association’s assessment seems fair. They stressed the relative harmlessness of e-cigarettes.

Their October 2014 Health Effects and Safety report begins, “The overall health effects of e-cigarettes should be considered both in the context of the intrinsic toxicity of e-cigarettes and with regard to their relative toxicity compared with the well-known injurious effects of smoking conventional cigarettes.”

If not “healthy,” at least “healthier.” No, we don’t know that vaping is “safe.” In fact, it probably isn’t. But it does seem that e-cigarettes are safer than regular cigarettes and a little industry regulation could go a long way.

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It’s All the Same to Your Insurance Company

“Someone who is a dual user is still a smoker, but someone who completely switches to e-cigarettes is essentially a quitter,” Siegel says. “That’s smoking cessation. There’s very strong clinical evidence that smokers who switch to e-cigarettes experience a dramatic improvement in their health. Their objective respiratory symptoms improve dramatically, their lung function improves, they’re no longer exposed to high levels of carcinogens and tar, and I don’t see how a person could continue to classify them as smokers.”

Most vapers would agree with Siegel. Very few insurance companies do.

Insurers rarely distinguish between vaping and smoking. They do not consider e-cigarettes a smoking cessation aid, but a tobacco product. Smokers pay more than non-smokers for health and life insurance. The details change from policy to policy, but vapers usually pay as much as smokers. Is this fair? Is there a better way?

Health Insurance and Vaping

The 2010 Affordable Care Act (Obamacare) came down hard on smokers. Smoking is the number-one killer of Americans through preventable illness. It claims over 480,000 lives every year. The administration hoped to discourage smoking with higher health insurance premiums.  The Affordable Care Act allows insurers to charge tobacco users up to 50 percent more.

The act also requires that all plans sold after September 23, 2010, cover smoking cessation therapy at no out-of-pocket cost. Most people apply for health insurance through an online marketplace. Applicants are asked if they use tobacco products or smoking cessation aids. Are e-cigarettes either?

It’s true that many people use e-cigarettes to quit smoking. There are thousands of stories of people who’ve kicked nicotine after decades of addiction thanks to vaping. Yet e-cigarettes aren’t a proven smoking cessation aid. Indeed, 76.8 percent of people who use e-cigarettes also smoke conventional cigarettes. E-cigarettes also don’t technically contain tobacco. They contain liquid nicotine.

Many e-cigarette users do not know what to put on their applications. Some wind up identifying as non-smokers and risk fraud. Others identify as tobacco users and pay the full premium hike.

Neither is fair or accurate. Perhaps the best way to deal with the ambiguity of tobacco premiums is to remove them altogether.

While there is evidence that vaping can help people stop smoking, there is no evidence that higher insurance premiums help people stop smoking. Six states and Washington, D.C., have already eliminated the tobacco question on the insurance application on the grounds that it disproportionately affects low income and non-white applicants. Higher insurance premiums are a difficult burden for low-income smokers to bear. They often discourage people who need healthcare the most from buying insurance.

Removing the penalty for tobacco eliminates both confusion for vapers and a “vice tax” that may be unfair. But what about life insurance?

Vaping and Life Insurance

Unlike health insurance, life insurance is more of a luxury than a right. It makes sense that risk is proportional to cost. Smoking is risky behavior. Vaping is less risky, but how can underwriters distinguish between the two?

The Affordable Care Act may use the word “tobacco,” but most life insurance policies use “nicotine.” Because e-cigarettes deliver nicotine, nine out of 10 insurance underwriters still consider vapers and e-cigarette users “smokers.”

Life insurance applicants have a harder time fudging their answers. Most applicants for life insurance have their responses verified through blood, saliva, or urine tests. The tobacco test is for cotinine, a product of metabolizing nicotine in your body. Your test results will include cotinine whether you’re getting it from traditional cigarettes or e-cigarettes. Because underwriters can’t distinguish between the two the policies they offer are the same. One could opt for an insurance plan that doesn’t require a medical exam, but these life insurance plans are typically more expensive.

If vaping really is healthier than smoking, it follows that life insurance for vapers should be cheaper. However, if insurers started offering lower premiums to vapers, what’s to stop a cigarette smoker from identifying as a vaper to save money? A whole new system of testing would need to be in place.

When asked if there’s a way insurance companies could differentiate between those who exclusively use e-cigarettes and “dual users” who both vape and smoke, Siegel offered a possible solution. He says that underwriters could test applicants for carbon monoxide rather than cotinine.

“The one thing that everyone agrees on, even the people who oppose e-cigarettes who are arguing that these are dangerous, is that they do not emit carbon monoxide,” Siegel says. “You could expect the exhaled CO levels to go down drastically [if someone smokes exclusively e-cigarettes]. If someone is a dual user, it’s not going to disguise the elevated CO levels because even just a little smoking is enough to raise them.”

Siegel believes that for many e-cigarettes are a valuable smoking cessation aid. A carbon monoxide exhalation test might be an easy, non-invasive, and inexpensive way for insurers to identify cigarette smokers. Perhaps if vaping continues to gain popularity some underwriters will adopt this test to attract e-cigarette users while keeping their risk assessment practical.

New FDA Regulations and their Consequences

Last May, the FDA released sweeping new regulatory policies for e-cigarettes. They brought all Electronic Nicotine Delivery Systems (ENDS) under FDA jurisdiction. E-cigarettes are now officially classified as a tobacco product.

The rules that came with this decision are tough. Any product made after February 15, 2007—virtually all products in America—must be submitted to the FDA for approval. Industry regulation is long overdue, and accurately labelling and rigorously testing these products will benefit vapers. But some worry the new rules are too strict.

The American Vaping Association estimates it will take 1,700 hours and cost over $1 million (per product) to earn the FDA’s approval. That would hit “mom and pop” vape shops hard. They often mix their own flavors, making them both manufacturers and retailers. Most independent shops won’t have the resources to meet the new requirements. It’s possible "Big Tobacco" companies will be the only ones who can compete.

“It’s like using a sledgehammer to hit a nail,” Siegel says. “[The FDA decision] was so broad it decimated the entire e-cigarette market rather than more directly and narrowly regulating the safety aspects of the product.”

Others think the new rules didn’t go far enough. “We want to make sure that this is not the last the thing they do, but just the beginning of what they’re proposing,” says Erika Sward, the American Lung Association’s assistant vice president of national advocacy.

“We are most disappointed that the rule did not include—or rather, the White House Office of Management and Budget took out—the provision that would have ordered flavored products to be removed from the market in November,” Sward adds.

Sward says the FDA found e-cigarette and other tobacco flavors are “not appropriate for the protection of public health and should be removed from the marketplace in November.” Its original draft of the policy included a ban on flavored products that attract minors and discourage smoking cessation. The White House Office of Management and Budget deleted it.

When asked about the effect these regulations might have on what has so far been a vibrant and competitive e-cigarette market, Sward replied that the American Lung Association’s goal is to “eliminate tobacco use across the board.”

“We cannot have tobacco be the leading cause of preventable death,” she says. “It’s responsible for half a million deaths a year. We strongly agree with the FDA’s decision to regulate e-cigarette retailers that make their own mixes… I am much more concerned about the safety and health of what individual users are inhaling.”

Siegel, on the other hand, says a hardline approach to e-cigarette policy does worse than close indie vape shops. It also abets “Big Tobacco” and costs human lives.

“They are kind of blinded by their ideology,” Siegel says of e-cigarette opponents. “They have this ideology that anything that has nicotine in it is bad. Anything that looks like smoking is bad, and people shouldn’t be putting these dangerous things into their mouths and inhaling. But the reality is that most smokers aren’t going to quit and harm reduction is really the most important approach for most people. I’m talking about 95 percent of the population of smokers—no more than 5 percent of smokers quit in any given year. So the bulk of the smokers are not going to be held by this attitude of ‘quit or die.’

“You have to be able to make decisions in the absence of certainty. That is what public health is all about,” he adds. “We’re not in a situation where we’re going to find out in ten years that these products are killing thousands of people… [Vaping] isn’t going to turn into some unforeseen disaster. The disaster that’s going to happen is that people who continue to smoke are going to continue to die. If we know that, why should a little bit of uncertainty stop us from saving people’s lives?”