Fact CheckedAre you Googling Life Insurance Marijuana this week? Well, you’re NOT alone, my friends.
The manufacture, distribution, possession, and use of marijuana has been legal across Canada for almost a decade.
Did you know Marijuana is one of the most widespread recreational drugs available on the planet today and 3rd only to alcohol and tobacco in popularity?
Canada was the 2nd country in the world to legalize the recreational use of the drug nationwide.
So, did these changes impact life insurance? Find out!
Life Insurance Marijuana & Why You Need Policy Architects
Life Insurance Marijuana use is a topic that a lot of people want clarification on. There are some very legitimate reasons to use pot, as it has many medicinal qualities.
Life insurance for medical marijuana, however, is approached with caution.
“…insurers are treading carefully. Sun Life covers pain associated with cancer, multiple sclerosis, rheumatoid arthritis, HIV and palliative care for serious illnesses; chemotherapy-induced nausea; spasticity from MS; and anorexia due to HIV.”
Why Canadian Insurers are Wary of Covering Medical Marijuana
As you can see, life insurance companies aren’t jumping on bandwagons. That’s because there isn’t much research in this area to back up the safety of Marijuana.
Marijuana has been a banned substance, which made purchasing it difficult for these reasons. The good news is legalization is about to change all this.
Life Insurance Marijuana! It’s All Changed!
Did you know Canada is now one of the world’s premier manufacturers of cannabis products?!
Clinical studies are beginning on a massive scale to mine out the medicinal benefits of marijuana. These are exciting times for proponents of Marijuana.
Just think of the possibilities! This research may reveal aspects of this incredible plant that we haven’t even considered!
Medicinal Uses of Marijuana
Marijuana use is a topic that a lot of people want clarification on. There are some very legitimate reasons to use pot, as it has many medicinal qualities. Life insurance for medical marijuana, however, is approached with caution.
“…insurers are treading carefully. Sun Life covers pain associated with cancer, multiple sclerosis, rheumatoid arthritis, HIV and palliative care for serious illnesses; chemotherapy-induced nausea; spasticity from MS; and anorexia due to HIV.”
Why Canadian Insurers are Wary of Covering Medical Marijuana
As you can see, life insurance companies aren’t jumping on bandwagons. That’s because there isn’t much research in this area to back up the safety of Marijuana.
Marijuana was a banned substance. Which made purchasing it difficult for these reasons. The good news is legalization has changed this.
It will be interesting to see how things unfold over the coming decades.
Life Insurance Marijuana: Some Are Concerned About Legalization
Although there are many Canadians who love walking into a cannabis store or shopping for marijuana products online, there are others who are worried.
They voice concerns about the proliferation of medical marijuana shops – they’re popping up on every corner – and whether the government’s distribution plan was ill-conceived.
No matter how you slice it and dice it, legalized recreational marijuana is here to stay, and we’re going to have to learn how to deal with it.
A Brief History of Marijuana
Before we consider Life Insurance Marijuana, let’s take a quick peek at the history of this popular plant.
In North America, colonists began growing marijuana (hemp) in the 1500s to make cloth and rope. Production continued into the 1930s until the U.S. federal government passed the Marijuana Tax Act.
Yep, it’s always about the money, people.
This act was implemented due to fears that Mexican and West Indian immigrants were introducing Marijuana as a means of intoxication through port cities such as New Orleans…
…or at least that’s the official story.
The Marijuana Tax Act of 1937 imposed heavy tariffs, which made the sale, possession, and transportation of hemp so costly it effectively banned it.
Hmmmm.
Pot Grows in Popularity
Marijuana, associated with jazz musicians and edgy culture, was vilified by a lot of the talking heads. There was a lot of concern that widespread use would influence young people and lead them astray.
In the 1960’s, marijuana’s popularity skyrocketed among middle-class college students. To counter this, President Nixon’s Controlled Substances Act of 1970 was passed, which classified marijuana as a Schedule 1 drug.
You are effectively putting it in the same class as heroin and cocaine.
Ooof.
Life Insurance Marijuana
Of course, this led to the war on drugs in the 60’s and 70’s. Sigh – and we all know how that ended.
As you can imagine – at this juncture – if you applied for life insurance – using weed was a serious problem.
Put it this way: if a policy was issued and the insurance company later learned that you were a marijuana user, they would likely cancel it.
Thankfully, as time wore on, life insurance companies loosened the reigns. In the 1980s and 1990s, insurers figured out they had to change with the times.
As recreational drug use became more and more acceptable in society, their approach shifted.
Early studies facilitated these sentiments, which indicated that the paranoia around Reefer Madness was unfounded. Recreational marijuana use wasn’t the one-way path to hard drug use, people feared.
Life Insurance Marijuana: Underwriting
So here we are today!
In the rush for legalization, life insurance marijuana is still a murky area. There’s no consensus in the industry regarding the impact of marijuana on your health and longevity.
Which makes underwriting marijuana users challenging.
There’s only a minimal amount of medical data for life insurance companies to reference. That’s why they’ve been so cautious about underwriting both recreational and medicinal marijuana use.
Underwriting for Marijuana Smokers Before 2016
Let’s remember that life insurance companies are in the business of making money and mitigating risk. If an increasing percentage of their customers begin using marijuana as a recreational drug, they need to know what that means for their bottom line.
The next question is how should they underwrite something they can’t properly assess.
Well, that’s easy!
Just lump marijuana users in with smokers…
…or at least this is how they handled underwriting until 2016.
If you disclosed any marijuana use, you were automatically categorized as a smoker and, as such, paid much higher premiums.
Well, before 2016, it didn’t matter! You were still lumped in with smokers. Insurance carriers assumed if you were smoking weed, you were likely to be smoking cigarettes as well. Besides, there was very little research to suggest smoking pot was any safer.
Funnily enough, if you smoked no more than one cigar per month now, you’d be eligible for standard non-smoker rates!
This is still a standard policy among most life insurance companies in Canada.
When the Canadian government decriminalized cannabis for medicinal use, life insurance companies began to treat marijuana users differently.
They no longer considered marijuana use to be a high-risk activity. Since 2016, almost all major carriers have offered standard non-smoker rates to casual marijuana smokers…
…provided they don’t mix tobacco in with their pot.
How Does Marijuana Legalization Affect My Life Insurance
Well, the good news is if you’re looking for life insurance marijuana – you’re no longer looking at smoker rates.
The bad news is at the time I’m writing this article, the best health classification you can expect to get as a marijuana user in Canada is a standard, non-smoking rate.
I do believe that as our industry comes to grips with legalization, we’ll see Canadian Carriers offer preferred plus rates to marijuana users as they do in the US.
For example, if you smoke marijuana once per month or less, you may be eligible for preferred plus rates with Lincoln National Life insurance…
The US is Different Than Canada When it Comes to Life Insurance Marijuana
…and preferred rates if you smoke no more than twice weekly.
Hey, Minnesota Life may offer you preferred rates if you smoke marijuana 24 times per year or less.
I think it’s very likely that Canadian Carriers will follow suit; it’s just a matter of time.
Canada Protection Plan announced it will give marijuana users non-smoking rates if they smoke marijuana no more than six times per week.
Not to mention the fact that Assumption Life’s Simplified Issue allows “frequent” marijuana smokers to obtain non-smoker rates won’t penalize applicants if they smoke cannabis less than 10 times per week.
Whatever You Do, Don’t Lie About Smoking Pot!
The temptation is there to fudge the truth – right!?
NOOOOOO. Please never lie to your agent or life insurance company to lower your premiums.
It’s the worst idea. You must always respond to questions with complete transparency.
If your life insurance company learns that you are not being honest, it can and will refuse to pay your beneficiary’s claim.
Yes, this is called fraud, and you must avoid that at all costs.
Life Insurance Marijuana: There’s No Such Thing as Stretching the Truth
Hey, come on, man, now that recreational marijuana use is legal across Canada, there’s really no reason to disclose my usage…
…right?
That is wrong. I would never recommend approaching life insurance this way.
For argument’s sake, let’s assume you’re an occasional pot smoker. How likely is it that you’ll pass the life insurance drug test?
Typically, when you apply for traditional life insurance, you undergo a health exam, which requires blood and urine analysis as well as:
- Blood pressure check
- A battery of questions about your medical history, etc.
The blood test can detect Tetrahydrocannabinol (THC), one of the active ingredients in marijuana, anywhere from 3 to 14 days after use.
A urinalysis test for life insurance reveals marijuana use as far back as one month or more, depending on your frequency of use.
So let’s say you think you’re in the clear. Why should you tell them you smoke the occasional joint?
Lying is Just NOT Worth It
Even if you stand a good chance of getting under the wire, is it worth the risk? What happens when you’re caught misrepresenting the facts on your life insurance application?
You’re jeopardizing your coverage and your family’s security. Premiums are expensive, and what if it’s all for naught?
Did you know that even if your death is unrelated to marijuana use, the insurance company will deny a claim if you lie on your application? This means your beneficiaries won’t see a dime if they can prove you lied.
Secondly, have you ever tried to apply for a credit card with a bad credit rating?
Well, it’s the same for life insurance. When the company finds out you made a false statement on your application, it reports you to the Medical Information Bureau (MIB).
If you try to apply to another insurer, they’ll discover your lies through the MIB and reject your application.
When it comes to life insurance, honesty is always the best policy.
Life Insurance Marijuana: Why You Need to Call Us Today!
Whew! Life insurance marijuana is a hot-button issue, and we are following this exciting area of life insurance as it unfolds.
I think it’s so crucial for people to know what is happening promptly.
With so much innovation in the medical field, clients should understand that life insurance underwriting is not cast in stone.
It’s constantly changing. Insurers want to expand their market as far as possible while making money.
This means when clinical studies roll in about CBD oil, edibles, vaping, and smoking, underwriters will switch up their approach.
We will see much more permissiveness, which means cheaper premiums for YOU.
Please read our blog to stay informed about unfolding events. If you have any questions, give us a call today. We look forward to discussing your circumstances with you.
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