The Blunt Truth About Marijuana and Life Insurance

Society’s perceptions of marijuana have undergone a drastic change since I was in junior high. Back then, it was normal for schools to assign "Tuned Out" as part of the curriculum and show “Reefer Madness” in class, with the intended purpose of teaching us that pot would turn you into an acid addict who would eventually go crazy or that getting stoned would result in a horrific car crash.

It’s true that pot could be a gateway drug for some people and driving while impaired is always dangerous. But society as a whole has developed a much greater comfort level with marijuana. Is this change reflected in the life insurance industry? Through the years, I have helped many pot users purchase a policy, and these are the questions that often come up. 

Here are my answers to five of the 10 biggest questions related to pot and life insurance. In part two, I'll provide my answers to the second five biggest questions.

1. How Does Marijuana Affect Your Mortality?

While there is certainly valid information that shows the positive health effects of marijuana use, there is equally compelling data that points to the downsides of the drug on your health. Life insurance underwriters look at the impact on the total body. Here are some of their primary concerns:

  • Impaired driving
  • Acute respiratory illness and infections
  • Addiction, leading to risky behavior
  • Increased heart rate, potentially leading to a heart attack
  • Mental illness, including temporary psychotic reactions, depression, anxiety, suicidal thoughts and personality disturbances
  • With pregnant women, postpartum neurological issues

Clearly, each of these conditions could potentially impact your mortality. (For more from this author, see: How to Buy Life Insurance With an Alcohol History.)

2. Is Smoking Marijuana Treated the Same As Smoking Tobacco?

To a large extent, yes. Carriers tend to view both activities the same way, but they can differ from one another in how they treat these activities. Some will make their best underwriting class available while others will automatically assess an extra premium with a table rating. A number of factors impact this determination, including frequency and dosage, how the marijuana is used (smoking, ingestion or vaporization), and the age of the insured. (For more, see: 3 Tips for Smokers Buying Life Insurance.)

3. How Is Age a Factor in Underwriting Marijuana Users?

Some carriers perceive an increased mortality risk in younger users. They have good reasons for this, especially when it comes to automobile deaths. Therefore, they will not issue policies to people below a certain age or, if they do issue a policy, they may automatically assess a table rating extra premium for those below a certain age. On the other hand, some carriers do not set a minimum age limit for this scenario. 

4. Should I Stop Using Marijuana for a Few Weeks to Qualify for a Non-Smoker Rate?

Believe it or not, not every carrier tests for marijuana on every insurance exam. Carriers who don’t are relying on your application disclosures to underwrite you. While some people may be tempted to lie under these circumstances, there is a strong discouragement to do so.

First of all, even if your drug test comes back clean, your medical records may indicate your marijuana use since physicians often make a note of this in their charts. If you don’t acknowledge your use of pot on your application, you run the risk of being declined automatically. Underwriters don’t like it when it appears the applicant is trying to get away with something.

Secondly, your application requires you to sign a statement to the effect that to the best of your knowledge, your answers to the questions are truthful. If you willingly withhold information, you could be accused of committing insurance fraud. The carrier would be within its rights to not pay the benefit, even if the cause of claim has nothing to do with drug use. (For related reading, see: What You Need to Know About Insurance Fraud.)

Also, cheating can artificially increase prices. Insurance companies need to make an accurate assessment of the risks they assume to ensure sufficient money has been allocated to meet anticipated claims. If they are not entirely aware of all the risks involved, they may underfund their reserves. This could result in an increase in prices to make up the difference, and you and everybody else could end up paying more than you should be. 

Lastly, remember that your broker has an ethical and legal responsibility to report everything he knows about the underwriting risks you represent. This includes both medical and lifestyle-related risks, including anything you tell him about your personal habits. No such conversation is “off the record.” He cannot do you a favor or bend the rules to get your business because he could face fines, suspensions and/or lawsuits.

5. Will How I Use Marijuana Change My Premium Price?

Many people don’t smoke marijuana. Instead, they eat it in home-baked goodies or vaporize it. How you get the drug in your system could result in a price break. There are some carriers who distinguish between smoking, ingesting or vaporizing. The difference could be as significant as being rated a non-smoker as opposed to a smoker. Again, many other factors can influence what rate class you are assigned. (For related reading, see: How Smokers Can Obtain Life Insurance.)

Just like alcohol and tobacco use, a history of using marijuana can affect your access to life insurance but as times have changed, so has the life insurance industry. Prequalification would determine exactly how your particular use of marijuana would be treated by an underwriter, but you can still qualify for life insurance.

(For more from this author, see: How to Use Life Insurance as an Executive Benefit.)