Getting high on insurance: How marijuana impacts life insurance rates

Getting high on insurance: How marijuana impacts life insurance rates

[Update, August 2016: Since we published this story, there have been some changes in the social climate around marijuana use. See here for the best life insurance rates for marijuana users. We've also updated this article with more recent stats and our video on finding a life insurer that will work with you, but it's best to talk to an independent licensed broker or agent for details on your individual situation.]

We’re going to start off with an assumption: if you’re reading this article, you’re probably a marijuana user wondering if your drug use will show up in the life insurance urine test.

Let's start with the quick answer: Life insurance drug tests will test your urine and sometimes your blood, and that drug test will reveal marijuana usage.

If you were worried about this, you’re not alone: marijuana is the world’s third most popular recreational drug (after alcohol and tobacco) and America’s most popular illegal drug. According to a 2015 Gallup poll, 44% of adult Americans have tried marijuana.

Support for marijuana legalization has slowly crept higher since the mid-90s, according to Gallup pollsters. Marijuana was first made illegal in the U.S. in 1937. It was illegal nationwide until 2012, when Colorado and Oregon legalized the drug at the state level. Since then, six more states plus Washington, D.C, have legalized marijuana.

Marijuana is not legal or decriminalized nationwide, but the U.S. Drug Enforcement Administration under President Obama decided to stop actively pursuing marijuana offenses in states that have legalized marijuana in any form. With half of the country exempt from federal enforcement of the prohibition and 54% of Americans in favor of legalization, it’s only a matter of time before legalization becomes national law.

So, will marijuana legalization affect my life insurance?

In general, insurance companies are pretty conservative. You would be, too, if your entire business revolved around assessing the risks of everything around you.

This has proven to be controversial with one major type of insurance: health insurance. Despite medical marijuana being legalized in almost half of U.S. states, most health insurance companies do not cover medical marijuana prescriptions.

In the case of health insurance, their caution is understandable: whenever state laws conflict with federal laws, it’s better to be on the federal government’s side. Another huge hurdle? Since the federal government still classifies marijuana on the same level as heroin, meth, and other deadly addictive drugs, it’s almost impossible to use marijuana in medical studies.
But what about life insurance companies? Life insurers have to take a very holistic look at a potential customer’s life - are they a good driver, do they scuba dive, do they take long walks through electrical storms?

How does marijuana fit in? Will they outright reject marijuana users because it’s an illegal drug? Or are they more progressive about recreational use of a relatively safe drug?

To get an idea, we talked to underwriters and life insurance agents to find out how life insurance companies see marijuana users.

It really depends.

Imagine if we just ended the article like this. But seriously:

Each case is looked at on an individual basis.

There’s no simple guideline for how life insurance companies see marijuana users. Each life insurance company has different standards, with some being more lenient and others rejecting all drug users outright. How a life insurer will rate you also depends on the frequency of use. Smoke weed every day? You have a worse chance of getting a good rate than someone who only smokes once a week or once a month.

A lot of times, marijuana is lumped in with cigarettes.

According to Pinney underwriter Mike Woods, most life insurance companies put recreational marijuana use on the same level as cigarette smoking. "Cannabis contains carcinogens and evidence suggests that heavy cannabis use may be associated with oral cavity, pharynx, esophageal and lung cancers," Woods wrote for Pinney’s "Ask The Underwriter" series.

You might take offence to this, since some studies have shown marijuana use is much less risky than tobacco use.

But remember when we talked about the government putting the kibosh on medical marijuana studies? That makes it really hard for researchers to judge just how risky marijuana is. Until scientists can show without a doubt that marijuana smoking is healthier than tobacco smoking, expect this policy to stay the same.

Just like tobacco smoking, the less you smoke, the better your health classification will be and the lower your premiums will be. P.J. Thompson, a life insurance agent based in Massachusetts, said that in a few cases, his clients have been able to get rated as a non-smoker - similar to how life insurance companies treat "celebratory cigar" smokers.

Having a prescription might help...

Toby Bloom, President of Integrity Insurance, said that most insurers will consider medical marijuana users "upon medical records review." Even if a medical marijuana user is approved, there is a chance they will be rated as a smoker, Bloom said.

… but it depends what condition it’s treating.

Medical marijuana is intended to help treat "debilitating symptoms," Woods writes. "However, severity is subjective and open to interpretation."

Medical marijuana is a double-edged sword: if a condition isn’t considered serious by the insurer, you’ll be treated like a recreational user and get a worse rating. But if the condition is considered serious, it’s also likely to be uninsurable (AIDs, cancer, and severe arthritis are some examples).

Even if the serious condition is insurable, the cost of the life insurance policy will still be high.

Again, wait for the government to loosen its rules on medical testing of marijuana. In the future, marijuana might be a common prescription for everything from minor aches to terminal cancer.

Whatever you do, don’t lie to your insurance company.

This goes for marijuana users and non-marijuana users alike. Thompson said he had a few clients who were rejected for lying about their marijuana usage. "It wasn’t clear if the underwriters found out from the blood test or the medical records," Thompson said, but the end result was a rejected application.

What if marijuana is illegal in the shopper’s state? Still don’t lie. According to Woods, "The medical impact of [marijuana] is what’s of concern to underwriting, not so much whether a state makes its consumption legal or not." In other words: life insurance companies aren’t narcs, they just want to know how much to charge you.

It’s hard to hide marijuana use.

Life insurance companies usually require shoppers to undergo a medical exam, which also means a blood and urine test. THC shows up in a blood test for anywhere between 3 and 14 days after marijuana use, depending on how frequently the user partakes. Marijuana is detectable in urine for up to a month, again depending on frequency of use. (Read more about the life insurance drug test.)

But seriously, don’t lie to your insurance company.

We know we just told you exactly how long you need to abstain from smoking to get away with it on your medical exam, but again, we have to stress: do not lie to your insurance company.

If they find out you’ve lied to them and they reject you, you won’t just be rejected from that company - you’ll be rejected from all of them.

If a life insurance company finds out you’ve lied to them, they will report you to the Medical Information Bureau, or MIB. Think of the MIB kind of like your credit report: you can’t just default on a credit card and then go and sign up for another credit card without getting dinged for it. Same goes for insurance: you can’t misrepresent yourself at one insurance company and expect that the other companies won’t find out about it.

How can marijuana users get the best insurance rates?

No matter what drugs you do or don’t use, the best way to shop for insurance is through a licensed broker. (But actually, if you’re using illegal drugs like heroin, you’ll probably get rejected.

Brokers will help you find the cheapest policy that fits your needs. PolicyGenius is an online broker that makes the insurance shopping experience fast and easy. Get your free life insurance quote now. We’ve had marijuana users come through our digital doors and get good life insurance policies, so don’t hesitate.