Marijuana and life insurance

Marijuana is in a complicated legal situation within the United States. In many states, people can legally consume cannabis. However, while legal at the state level (in some states), it is still a federally illegal substance. People who live in states where it is legal to consume cannabis may wonder how their usage will be treated by life insurance companies and if there is life insurance for marijuana users. The good news is that if you are using cannabis legally, it should not keep you from finding life insurance coverage, although it is possible you may pay higher rates.

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Does marijuana use impact life insurance rates?

Insurance companies determine their own rules, for the most part, when it comes to deciding how marijuana use will affect rates. Life insurance companies use a health classification system for policy applicants. There are five tiers to this ranking system: preferred plus, preferred, standard plus, standard and substandard.

The better an applicant’s health and health-related behaviors, the better their health classification will be. This system is one place where the relationship between marijuana and life insurance can get tricky.

Some companies may categorize marijuana users as tobacco users because the category ‘smoker’ already exists within the ranking system. However, other carriers may have distinct rating categories for marijuana or vape users. Premiums can be significantly higher for smokers than nonsmokers. However, other companies use a more nuanced approach to determine how marijuana use impacts applicants’ health. Some companies may not raise rates for marijuana use itself but may do so for any underlying conditions that marijuana is being used to treat.

When determining how it impacts life insurance, insurers may consider how often you consume cannabis, the method in which you use it (smoking, vaping or eating), and whether your use is medical or recreational. With legal marijuana still being so segmented and state-specific, there is no standardized approach for life insurance companies.

The type of marijuana

The type of marijuana being used—whether medical or recreational—can play a significant role in how life insurance companies look at it. For instance, some companies see recreational use as a warning sign of health risk, while others see medical use as a health risk.

The delivery method

How marijuana is consumed can also play a role in how it affects life insurance rates. Depending on the marijuana delivery method—vaping, smoking, edibles, etc.—there can be a range of potential impacts on a life insurance policy. Some people point to smoking as the least healthy consumption method, so they believe that other delivery methods should not cause an equivalent hike in rates. However, these determinations are made by individual companies. As a result, some companies may charge higher rates for people who smoke marijuana than those who vape it or consume it in an edible format, while other companies may make no distinction.

The frequency of use

How often a person uses marijuana can also play a role in how life insurance companies determine rate impacts. Companies may decide less frequent use may be a lower health risk. Inversely, more regular consumption of marijuana may be a higher health risk.

The type of cannabinoid

Another distinction that can come up with life insurance companies is whether the primary cannabinoid is THC or CBD. The first, THC, is what iconifies marijuana as a mind-altering substance. The second, CBD, is mostly touted for anxiety reduction and muscle relaxation. The primary difference between hemp and marijuana is that hemp plants have been bred to create less than 1 percent THC by volume in their flowers. Unlike marijuana, hemp is federally legal.

While each of these distinctions may be seen as meaningful, it is ultimately up to each life insurance company to decide how they will use and interpret these variables.

How to address marijuana on life insurance applications

When filling out a life insurance application, the best strategy is to be honest. Getting caught lying on a life insurance application may be much worse than merely being turned down or seeing a higher premium in the first place.

If your insurer catches you in a lie on your application, the provider could cancel your policy, raise the rates on it or even deny benefits to your beneficiaries if you have already passed away. In fact, your policy could be canceled outright if the lie is uncovered during your life insurance policy’s contestability period. While legal consequences are unlikely, these instances do count as a type of fraud.

Your insurer may use the Medical Information Bureau (MIB) to identify potential lies on your life insurance application. The MIB uses a system of proprietary codes to track applicants’ health histories, but not specific medical conditions. Any alerts from the MIB may prompt further investigation by an insurer but cannot alone justify an adverse underwriting decision.

When reporting marijuana use on a life insurance application, there are some crucial factors to include:

• Frequency of use
• Quantity of use
• Medical vs. recreational designation of use
• Primary method of delivery or use

These variables are some of the ones that a life insurance company will want to consider when reviewing an application.

It may also benefit you to take the time to shop around. While not all companies will advertise their life insurance for marijuana users, you could ask about your options before choosing to apply.

Frequently asked questions

• • Will marijuana use raise my life insurance premiums?

    It depends on the life insurance company. Depending on the frequency and type of marijuana use, carriers may raise or not change your rates. You may even see lowered insurance premiums If you are successfully using medical marijuana to manage a different medical condition. Ultimately, whether marijuana use will raise or lower your premiums will depend on your use circumstances and the specific life insurance company.

  • What happens if I start using marijuana after I’ve already gotten a life insurance policy?

    Within most life insurance policies are a series of warranties (as in promises or statements of truth). Some of these will be signed guarantees that your application information is accurate. In contrast, others may state that you will inform your insurer if you become a smoker. In general, notable changes in health or behaviors that can influence health are things that the insurance company will want to know. Speaking with your life insurance agent may help you decide if you need to disclose any additional information to your insurer after purchasing a policy.

  • Do life insurance companies test for marijuana use?

    When you apply for life insurance, some insurers may require you to take a medical exam — which might include giving urine and blood samples. If THC is found in your bloodstream and you didn’t disclose marijuana used, an insurer may deny your application.

  • What are the best life insurance companies for marijuana users?

    The best life insurance company and policy for one person may not be the best for another. Although life insurance quotes do not vary much from provider to provider, shopping around is likely the best way to find a company with the coverage options you want. You may also want to consider customer satisfaction metrics and financial strength ratings when choosing a carrier.