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A Marijuana User’s Guide To Life Insurance - Forbes

Posted: 21 Feb 2020 12:00 AM PST

More than 11.8 million young adults said they used marijuana in the past year in 2018, according to the National Institute on Drug Abuse. With the prevalence and acceptance of marijuana use growing, it's important to understand how marijuana can impact your life and health — even your finances.

For marijuana users, one of the many aspects of life likely affected is life insurance. The ability to buy affordable life insurance is often an important part of a solid financial plan. But when marijuana users get jobs and start families and want life insurance, they can find that pot use dings them.

Marijuana Use and Health

Right after use, marijuana impairs judgment and short-term memory. It also alters perception, making it dangerous to drive, among other activities.

We couldn't find definitive studies that prove that using marijuna will reduce a person's life expectancy. The Society of Actuaries, which often studies "mortality," says it has no specific studies on marijuana use. But marijuana is associated with lifetime psychiatric problems, according to a 2018 study by the National Institute on Drug Abuse.

Long-term use, from age 18 into a person's 20s and later, is also associated with health problems at age 50. While the marijuana is not shown to directly cause psychiatric and health problems, researchers have linked the use of pot to these issues later in life.

How Often Do You Use Marijuana?

When you apply for life insurance, you'll likely face a question about whether and how often you use marijuana. Your answer will help group you into a health class, such as super-preferred, preferred or standard. This will help determine your life insurance rate, along with your answers to many other health and lifestyle questions.

"A lot of people are reluctant to admit recreational marijuana use," says Robert Bland, CEO of LifeQuotes, an online life insurance agency.

Occasional marijuana users can sometimes qualify for non-smoking rates, depending on the company. This is key, because getting classified as a smoker will mean higher life insurance quotes. Occasional use is sometimes defined as only one or two times a month. Each life insurance company decides its own parameters for what's "occasional."

"The basic adage is, if you smoke marijuana, you're a smoker," says Bland. "So when people hear that they tend to say they don't smoke or it was during a vacation as a teen to Boulder, Colorado."

How Much Will Marijuana Affect Your Life Insurance Rates?

Life insurance quote increases based solely to marijuana use will vary based on your age, gender and amount of coverage requested. That makes it hard to pin down an average increase. Here's how much average quotes go up for 30- and 40-year-old men and women who are shopping for a 20-year term life insurance policy of $500,000.

Life Insurance Quote Increases for Marijuana Users

Gender and age	Increase for occasional marijuana use (2 or less times per month)	Increase for regular marijuana use (more than 2 times per month)
Male age 30	23%	47%
Male age 40	23%	70%
Female age 30	22%	34%
Female age 40	29%	58%
Methodology: We averaged the five lowest life insurance quotes we found online for healthy men and women of average height and weight. We used quotes for a 20-year $500,000 term life insurance policy.

What About Medical Marijuana?

Whether you say you use marijuana recreationally or for medical reasons probably won't matter in terms of the resulting life insurance rates based on use. For medicinal marijuana users, a life insurance company will want to know about the underlying medical condition that led to the marijuana. And that medical condition can also affect the life insurance quotes you get.

"A lot people say for it's pain and that's not enough, that's way too general. They want to know what's causing the pain," says Bland.

For example, back pain is common and won't lead to higher rates. But using marijuana during chemotherapy is quite another matter and the life insurer will then focus on the medical condition.

Be Honest About Your Marijuana Use

The goal of a marijuana user who's buying life insurance should be to get a non-smoking rate, especially if the use is occasional. Those who ingest marijuana, such as edibles, should be able to get a non-smoking rate.

Regardless of how often you use marijuana, and whether it's recreational or medicinal, it's important to be truthful on any life insurance application. Remember, you're going to be signing your name to the application and attesting that the information is true.

"Misrepresentations" can be viewed as fraud and, at worst, can result in a company voiding the policy later.

"We advise customers that it's a crime in all 50 states to make a misrepresentation on an insurance application," says Bland of LifeQuotes. "When you're formally applying, you're authorizing the insurer to check all outside records on you, including doctor records. When you fill out an application, you're baring your soul. All your answers on your application better match your doctor records and history."

You'll likely be required to take a life insurance medical exam, which includes giving blood and urine samples. This is true for many life insurance buyers, not just marijuana users. The life insurance company will also likely look at your medical records and current and past prescriptions. It will pull your motor vehicle record. It will access your past answers to individual life and health insurance applications.

"The buying public needs to realize all your information is verifiable," says Bland.

If you weren't honest about marijuana use on the application and evidence pops up in your medical records or in the life insurance exam, "look for a decline on your application. Insurers see it as a moral hazard. What else have you lied about? They'll take a pass," warns Bland.

Adding Other Issues To Marijuana Use

Expect higher rates if there are other factors that will push your life insurance quote up, or even result in a denial. This includes health conditions and black marks in your history, such as a history of substance abuse, a criminal record or moving violations like a speeding ticket or DUI. These are called "rateable" issues.

"If you have rateable issues, work with an agent who will do preliminary quotes for you. You provide all the information and they anonymously shop you first, rather than formally apply," advises Bland. Many agents will perform this service, he says. That way you'll know where you stand before you apply. You don't want to be sending applications to multiple companies.

Summary: Life Insurance Buying Strategy for Marijuana Users

Be 100% truthful on a life insurance application.
Be prepared to take a life insurance medical exam. The results should match what you've said on the application.
Find an agent who will shop the market for you anonymously before you formally apply.
Try to get a non-smoking life insurance rate.

Forbes adheres to strict editorial integrity standards. To the best of our knowledge, all content is accurate as of the date posted, though offers contained herein may no longer be available. The opinions expressed are the author's alone and have not been provided, approved, or otherwise endorsed by our partners.

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