Marijuana and Life Insurance: Recognizing the Changing Perspective

Marijuana and Life Insurance

The insurance rate for a person who smokes marijuana mostly depends on its use and the insurance firm’s directives about it. Although most insurers show no prejudice on one’s consumption routine, some corporations maintain the conventional mode of correctly assessing the risk. Marijuana is the number one illegal drug, broadly consumed across the globe. Among the most sought-after recreational drugs, marijuana comes third, next to liquor and tobacco. A 2015 survey of Gallup states that in every eight adults, the user is marijuana (any type). Since the survey tackles a delicate matter, it is highly likely that the real number of people who use marijuana might be greater than the survey indicates.

In the old days, marijuana consumption was a valid ground for rejecting insurance. If insurance was given and the firm eventually found out that the insured consumes marijuana, the insurance firm would use that knowledge as grounds for terminating the insurance.

Present days are transforming, just like the public’s opinion toward marijuana consumption.

The changing perspective has brought some insurers to reevaluate their outlook toward marijuana consumption about assessing risk for insurance and assigning charges for marijuana consumers.

Since marijuana consumption is currently authorized in various regions and its therapeutic use permitted in some states, several insurance firms are employing the information at hand to alter insurance policies. Traditionally, insurance firms sorted consumers of marijuana with those who smoke when registering for insurance policies. Successfully and accordingly, insurance firms considered marijuana consumption as a greater health risk for insurance policy candidates.

Life insurance providers are in the field to generate profits. If a few corporations modify their policy approach toward marijuana consumption, other firms are expected to reevaluate or wager losing few contracts to more forbearing rivals.

Marijuana Consumption and the HIPPA Privacy Rule

Although several policy firms hold a more tolerant stance on marijuana consumption, candidates may yet be unwilling to reveal their marijuana use, be it for therapeutic or recreational use. The leading reason why marijuana users would probably not avail of life insurance is the worry that police or their boss may be informed. Within the transforming world, the consumption of marijuana is being legalized by many life insurance firms. However, it is helpful to recognize the current perspective and how these transformations might impact marijuana consumers. 

Revealing marijuana usage on an insurance policy registration is classified and safeguarded by the constitution.

You probably encountered the term HIPAA during talks about health care or concerning health insurance. It is the Health Insurance Portability and Accountability Act that is being implemented in life insurance policies, just like in health insurance. It is written in a short and easy to understand manner. It is a privacy regulation that guarantees your privacy concerning marijuana consumption. In other words, it’s none of others’ business, and the constitution secures this privacy.

Another organization, the Medical Information Bureau, or MIB, acts as a reference for shared health data. Although MIB is part of the same HIPAA security that hinders the community from finding out marijuana consumption, MIB’s health data is accessible to associate corporations, including life insurance firms.

Marijuana and Life Insurance: Honesty Pays Off

The majority of insurance policies demand a health assessment. A segment of that assessment involves laboratory analysis of blood and urine. Marijuana can be identified in one’s body sometime later after consumption. The test for determining marijuana consumption looks at the existence and concentration of tetrahydrocannabinol. Although the amount of the substance detected by blood test drop shortly after usage since the substance is drawn into bodily tissue, some references suggest that urine tests can identify chemical even after three months posterior to consumption. This extended identification duration is highly possible for habitual consumers, yet the key idea is that it’s hard to conceal marijuana consumption.

If you are a marijuana consumer, be it for therapeutic or recreational use, and you like to avail of an insurance policy, your initial move is to speak with an agent to learn about which firms offer marijuana-tolerant life insurance.

As noted, not every insurance firm is as progressive about marijuana consumption as some. In these firms, not only do you hold a greater possibility of buying a cheaper rate, but you can feel at ease in revealing marijuana consumption. 

No matter which life insurance firm you pick to register with, don’t deceive the firm about your marijuana consumption.

In case an insurance firm rejects an applicant for falsifying their documents, that knowledge is sent to the MIB. A typical query on insurance policy registrations wants to know whether you have been rejected for life insurance before. Regardless of where you register, the insurance firm can obtain data from MIB reports, showing whether you have been denied for insurance and if you have lied on your medical data on former registrations.

Knowing Insurance Policy Rating Classes

Insurance firms might utilize varied terms, but most insurance firms will use rating classes similar to the list below. Moreover, every underwriter might consider specific health areas to a larger or lesser extent compared with other underwriters. As per usual, it is crucial to communicate your demands with an insurance agent who can assist you in a firm or insurance policy that best suits your particular policy needs.

Life Insurance Policy Classes

  • Preferred – Superb health status and truthful family medical history
  • Standard Plus – Excellent health but has slight medical problems or family background compared to the preferred class.
  • Standard – This is the class for most people which denotes usual well-being and medical background 
  • Preferred Smoker – Excellent physical condition, with smoking
  • Smoker – A smoker with average fitness
  • Rated Applicants – Few insurance candidates are deemed “rated,” typically denoting a medical problem/s prohibiting the candidate from being classified in the usual sorting categories. The candidate can be insured, but expect higher charges. One may hear the phrase “table rating” when referring to candidates who don’t meet standard classes’ criteria. Table ratings are coded by alphabet or numeral characters, with every character equivalent to a rate rise in charge beyond the charge asked from a usual candidate.

A lot of underwriters, even the ones with commended big names, assign marijuana consumers to the smoker category. However, the weather is shifting, and more and more underwriters are appraising marijuana consumption for irregular marijuana consumers less intensely than smoking.

Why Pick A Marijuana-Tolerant Insurance Firm?

Life insurance corporations assign insurance charges depending on various considerations where the heaviest factor in one’s well-being. Not long ago, marijuana users, even the irregular ones, may see themselves in the same categorization as smokers.

It’s improbable that someone would smoke twenty marijuana sticks daily, similar to a usual tobacco smoker, yet many insurance firms regard the risk identical to a smoker. Cigarettes have many cancer-causing chemicals that marijuana does not have or have in smaller amounts.

More forward-thinking insurance firms acknowledge that the two habits cannot be accounted for with an identical degree of risk. Some insurers can offer desired rates and the top category for irregular marijuana consumers. Other firms may evaluate the risk the same as how they would assess an overindulgent cigarette smoker, with small or no sanction in insurance charge.

Nowadays, as many as a third of insurance firms offer the usual rates for irregular marijuana consumers. Anticipate a rise in that count in the future. Some firms are hesitant to modify their policy to accommodate marijuana consumers, probably bearing in mind the information stating that massive marijuana can be linked to its medical issues like cancers in the mouth, lungs, and esophagus.

How About Safe-to-Eat Cannabis Goods?

For the sake of appraising risk for an insurance policy, underwriters, nowadays, do not distinguish among the ways of consuming cannabis products, whether ingested, smoked, or vaped. Life insurance firms with marijuana-tolerant policies are more attentive with the regularity of consumption than the way of consumption.

Why Can’t Every Life Insurance Firm be Tolerant of Marijuana?

When an insurance firm ranks a policy candidate, they calculate the risk that the person may pass away soon and that they will need to disburse a claim soon. As a rule, more significant risk means a higher charge.

The information an insurance firm can collect regarding applicants helps the insurance firm analyze their risk depending on their well-being and routines. When the risk is analyzed, the firm can designate a rating category and assess the amount to be paid for the insurance. Cannabis consumption, as a risk, is not as aptly analyzed by underwriters as other risks. In contrast with other drugs, it typically does not cause addiction nor overdose.

While we feel grateful for the authorities’ privacy safeguarding via HIPAA effectiveness on insurance policies, we can also hold the government responsible for inhibiting research that could help life insurance firms learn more about the risks or advantages of marijuana consumption. 

The lack of research information merged with the government rules that consider marijuana consumption unlawful makes many insurance firms lean on the safe zone and assess the risk as similar to smoking. They result in assigning marijuana consumers in the class identical to regular smokers.

Premium Rates Can Vary Depending on the Regularity of Marijuana Consumption

Persistent cannabis consumption may prompt being categorized as a smoker. Even with insurance firms who are easygoing about marijuana consumption, continuous use may lead to a candidate being assigned to a less desirable rating category. Inversely, people who consume marijuana less often can land on a more desirable rating category, considering that their well-being meets the qualification for that rating category.

Rates for Therapeutic Marijuana Consumption

Every underwriter’s insurance policy discerns if therapeutic cannabis consumption can impact the class designated to a candidate. A few insurance firms can rate the risk as a smoker while some can rate that specific risk tolerantly. Although therapeutic cannabis consumption, when advised by a doctor, is typically recommended to remedy weakening indications. The illness or impairment for which cannabis is advised can impact qualification or rates.

Moreover, if the underwriter regards the cause for doctor’s order to be a less severe problem, they can account the marijuana consumption recreational. For several underwriters, if cannabis consumption is regarded as recreational, the candidate can be ranked as a smoker. Insurance agents can direct you in the correct path and pair you with an underwriter that best satisfies your demands. 

Speak with an Insurance Agent

People’s impression on recreational and therapeutic cannabis consumption is shifting. More and more insurance firms are paving the way to more forbearing rates for marijuana consumers.

An expert insurance policy agent can help you analyze your choices and offer you with a truthful estimate, considering that every information is noted. Be open and honest regarding your marijuana consumption regularity and other facts on your well-being, practices, and family background.

Being straightforward with your insurance agent holds no threat because HIPAA rules protect the confidentiality of users. Your honesty will enable your insurance agent to come up with a more precise estimate so you can secure your household and start to allocate for your life insurance.

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About Coach B.

After starting his financial career with Phoenix Home Life Insurance Company back in 1992, Scott decided he wanted to provide people with an easier and more enjoyable way to buy life insurance. That was the start of Coach B. Life Insurance, whose mission is to be transparent, honest, and helpful to customers — without ever bugging or pushing them.

In the years since then, he has worked tirelessly to improve the process of shopping for insurance. His goal is to make sure that everyone who comes to Coach B. — whether they end up buying a policy or not — has the best possible experience.

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