Marijuana Dispensaries: Do Life Insurers Snoop For This Data?

Marijuana users can get life insurance, but the cost of coverage depends on factors such as the frequency of use, the method of consumption, and whether it is for recreational or medicinal purposes. While some insurers may not count marijuana use against the user at all, others will consider these factors to assess eligibility for coverage and set their rates accordingly.

Life insurance companies use blood and urine tests to detect marijuana use, with THC remaining in the bloodstream for up to 36 hours and in urine for between three and 30 days, depending on the frequency of use. As such, it is important for applicants to be honest about their marijuana use, as lying on an insurance application is considered fraud and can lead to policy cancellation or denial of benefits.

How do life insurance companies feel about marijuana use?

Life insurance companies have varying policies regarding marijuana use, but generally, it won't disqualify you from being able to get life insurance. Marijuana is approved for medical use in 38 states and recreational use in 23 states, and its acceptance and legalization are expected to continue to rise. However, it is still a federally illegal substance, creating a complicated legal situation.

Life insurance companies often consider marijuana use an increased insurance risk due to its potential impact on health. Marijuana use may lead to higher life insurance rates, particularly for frequent users, as it could be associated with health problems. The method of consumption, frequency of use, and the reason for use (medical or recreational) are all factors that influence how insurance companies view marijuana users.

Some companies may categorize marijuana users as tobacco smokers, resulting in significantly higher premiums. However, other companies use a more nuanced approach, considering the underlying health conditions that marijuana is being used to treat. For example, insurers may view medical marijuana more favourably than recreational use, or vice versa.

It's important to be honest about your marijuana use when applying for life insurance. Lying on your application could lead to denial or cancellation of coverage, or even denial of benefits to your beneficiaries. While most companies will ask about marijuana use, they do not have access to this information from dispensaries.

How does marijuana use affect life insurance rates?

Marijuana use can affect life insurance rates in several ways. Firstly, the frequency of marijuana use is a factor, with occasional or recreational use potentially resulting in higher rates, while daily or regular use may lead to significantly higher premiums or even policy decline. The method of consumption also matters; smoking marijuana is generally considered less healthy than ingesting it through edibles or vaping, which can result in higher rates for smokers.

Secondly, the purpose of marijuana use, whether recreational or medicinal, can impact rates. Some insurers view recreational use as a warning sign of health risk, while others consider the underlying health condition when marijuana is used medicinally. The type of cannabinoid, THC or CBD, may also be a distinguishing factor, as THC is the mind-altering component of marijuana.

Thirdly, the insurance company's stance on marijuana use plays a significant role. Some companies may categorise marijuana users as tobacco smokers, resulting in higher smoker rates. In contrast, other carriers may have distinct rating categories for marijuana users, and their rates may be more competitive. It is important to shop around and compare quotes from different insurers, as underwriting guidelines vary.

Lastly, other factors such as age, gender, health, lifestyle habits, and medical history can also influence life insurance rates for marijuana users. Being honest about marijuana use on insurance applications is crucial, as lying or omitting information could result in denied or cancelled coverage.

What happens if you lie about your marijuana use on a life insurance application?

Lying on a life insurance application is never a good idea, and when it comes to marijuana use, honesty is the best policy. While it may be tempting to lie about your marijuana use to secure a lower premium, doing so can have serious consequences. Here's what you need to keep in mind:

Verification Process

Life insurance companies typically conduct a thorough verification process before issuing coverage. This includes reviewing your medical records, prescription history, motor vehicle records, and other documents. They may also require you to take a medical exam, which can include blood and urine tests that can detect marijuana use. Additionally, insurance companies have access to the Medical Information Bureau (MIB) database, which tracks applicants' health histories and can identify potential lies or omissions.

Consequences of Lying

If you lie about your marijuana use and are caught during the application process, the insurance company may immediately decline coverage. Your information will also be logged into the MIB database, making it more difficult and expensive to obtain coverage from other insurance companies.

If the lie is discovered after your coverage is issued, the insurance company may still take action. Life insurance policies typically have a two-year contestability period, during which the company can cancel your coverage or adjust your premium to reflect the higher risk. In some cases, they may even deny a death benefit claim made by your beneficiaries if they find out you lied on your application.

Impact on Premiums

It's important to understand that insurance companies consider various factors when determining premiums, including age, gender, health, and lifestyle choices. Marijuana use itself may not significantly impact your premium, especially if it is occasional use or if you ingest marijuana rather than smoke it. However, if you lie about your marijuana use and are caught, the insurance company may view this as a breach of trust and take a harder line when setting your premium.

Honesty is the Best Policy

While it may be tempting to downplay or omit your marijuana use, the risks of lying far outweigh any potential benefits. Being honest about your marijuana use allows the insurance company to accurately assess your risk profile and provide you with a fair premium. Remember, the goal is to secure coverage that will protect your loved ones in the event of your death. By being truthful, you can avoid the risk of having your policy cancelled or your beneficiaries left without the financial support they need.

What types of life insurance are available to marijuana users?

Marijuana users can qualify for both term life and whole life insurance policies. Term life insurance is the best and most affordable option for most people looking to provide their family with a financial safety net to cover any debts. Whole life insurance and other types of permanent life insurance are good options for high-net-worth individuals looking to use life insurance to diversify their investment portfolio, or people with long-term financial obligations or coverage needs, like dependents who require lifelong care. Whole life insurance is usually much more expensive than term life insurance.

Some insurance companies won't count marijuana use against you at all, while others will consider the method, reason for, and frequency of use to assess your eligibility for coverage. If you use marijuana daily, you may be denied coverage by most companies.

What are the best life insurance companies for marijuana users?

Marijuana users can get life insurance, but they may face higher premiums. The best life insurance company and policy for one person may not be the best for another. However, here are some companies that offer good options for marijuana users:

• Brighthouse Financial: Offers competitive rates, comprehensive coverage, and application decisions in as little as 24 hours.
• Lincoln Financial: Offers a diverse array of life insurance policies, including competitive no-med and high-net-worth options.
• Corebridge Financial: Offers competitive pricing and a range of flexible term periods for its Select-a-Term product.
• Prudential Life Insurance: Has some of the lowest-cost term policies and very lenient underwriting approaches for a variety of pre-existing medical conditions.
• MetLife: Offers very low-cost term policies and specializes in a variety of liberal underwriting guidelines for health issues.
• Foresters Financial: A fraternal benefit society that provides unique member benefits, including academic scholarships, financial counseling, and discounted legal services.
• AIG Life: Incorporates distinct underwriting niches and offers competitive rates.
• Transamerica Life Insurance: Known to be lenient in its underwriting approaches for seniors and offers competitive rates for no-exam medical life insurance.
• Banner Life: Excels as one of the leading companies when it comes to those with pre-existing health conditions and offers no-smoking rates for occasional users.
• Global Atlantic Life Insurance: Allows daily marijuana use and is great for marijuana industry business policies.
• Protective Life: Considered one of the leading companies providing low-cost term life insurance for both genders ages 30–60.
• Phoenix Life: Provides innovative term policies and no-exam coverage suitable for a variety of individual family needs.
• Sagicor Life: Considered one of the industry's leaders when it comes to no-exam life insurance and has some of the fastest approval times for approving policies.
• Fidelity Life: Provides a rapid decision approach for unique no-exam life insurance options and offers distinct flexibility in how you customize your policy.

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