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So Pot’s Legal Some Places. Does Life Insurance Care?

We’ve had a few questions coming from Colorado and Washington about life insurance stance on marijuana use since both states have legalized recreational use. We put the question out to all the life insurance companies we represent and I am writing this as the answers come in. What I think we’ll find is that legality will make some changes but, like alcohol, they are going to roll over for those who think stoned is the new straight. The other swing question is going to have to do with the way insurance perceive pot being ingested. Since proving one method over another would prove cumbersome, if not impossible, they will likely lean toward traditional smoking, which for many companies considering anything but very occasional use, the same life insurance rates that would pertain to a cigarette smoker. And it would appear from initial replies that they aren’t willing to debate with anyone about whether you smoked the pot or ate a cookie.

The first returns have been interesting with Protective Life, of all companies, actually appearing to have guidelines in place, guidelines that they are willing to talk about. Of course we know their products are designed so that little or no life insurance benefit is ever paid, but we’ll give them a gold star for this response to our question, “what is the underwriting stance is on marijuana use, occasional, regularly, frequently, in those states where recreational use is now legal?”

“Depending on the amount and frequency of marijuana use:

• Experimental – those who have tried or used at least once but no longer use – may qualify for best rate class of Select Preferred Non-Tobacco,
• Occasional – those using twice a month or less – best rate class would be Standard Tobacco,
• Intermittent – those who use 3 to 8 times monthly – best rate class would be Standard Tobacco,
• Moderate – those who use 9 to 16 times monthly – best rate class would Table 2, Tobacco,
• Heavy – those who use more than 16 times monthly (4 times weekly) – would be a decline.”

The there is the straightforward AXA Equitable answer, “Best available class would be Standard Smoker rates for marijuana use as long as there is no substance abuse history”.

ING Reliastar just really wanted to complicate the question and offered this. “Regrettably, we are unable to quote due to insufficient information provided.
We will need additional details regarding marijuana use for further consideration.
1. When did applicant starting using marijuana?
2. What is diagnosis and date MD prescribed medicinal marijuana use?
3. Please confirm weekly amount used and if its smoked or ingested.
4. Does applicant have stable employment with a clear MVR?
5. Any alcohol concerns or other substance use history.
6. Any psychological diagnosis: (Anxiety, Depression, ADD, ADHD, Stress PTSD etc.)”

Genworth Life and Annuity gives us the impression they think you might cheat on their drug questionnaire, saying, “OFFER, First ALL marijuana use gets our Tobacco rates. Experimental, occasional, and intermittent use can obtain Standard tobacco, moderate use is around Table C smoker rating, and heavy use it a decline. We do not give further details on this, as we need the applicants frequency of use completed on our questionnaire. Are they saying if you smoke pot you might be prone to lie about how much in order to get better rates? Don’t they know if you smoke enough to warrant lying about it then you will likely not remember where you saved this blog post to refer to.

Banner Life was also keeping their cards close to their chest with this response, “Best case scenario is std tobacco class for occasional use. More frequent use would be table 2, std tobacco. Medical marijuana, minimum table 2, std tobacco plus any additional rating for the cause. There are also cases where we would decline for daily marijuana use but cannot give guidelines for this because reviewed on case by case basis”.

Prudential was the only company that really hung it out there offering non smoker rates for anything less than daily use, “If use is up to 3 uses per week then we can ballpark Non-Smoker Plus. If 4-6 uses per week then Non-Smoker Class B. If daily use, no offer.

Bottom line. I haven’t heard from American General yet and I’m sure there are a number of companies who would prefer not to share their guidelines, but clearly things have not changed much. Legal or not, life insurance companies don’t have any actuarial data on pot smoking so they hedge their bet by adding on smoking rates that triple the cost. If you have any questions, call or email us. We can help.

About the Author

Every year millions are needlessly declined for life insurance or approved and paying far more than they need to. For 14 years, I have specialized in turning those situations around and finding the right life insurance solution at affordable rates. I give every client the personal attention they deserve.

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