- Marijuana use has become legal in more states, but it could still affect life insurance premiums.
- Some insurers charge higher rates or deny coverage if you smoke marijuana.
Marijuana users should understand how their life insurance premiums will be affected.
Across the United States, a growing number of places are legalizing the use of marijuana. As a result, millions of people are openly smoking or consuming cannabis -- some for health reasons, and others for recreational use.
While there is some evidence that marijuana has health benefits, at least when consumed in certain forms, this does not necessarily mean life insurance companies like it when applicants smoke it. In fact, marijuana use may adversely affect a person's ability to get life insurance or may make premiums costlier.
Here's what marijuana users need to know when shopping for coverage.
How marijuana use affects life insurance prices
When a person applies for life insurance, the company will ask a number of detailed health questions. In many cases, applications ask whether the individual uses drugs, including marijuana.
Applicants must be honest about this. Insurers typically also require a medical exam, which could reveal marijuana use even if the applicant did not disclose it upfront. And even if the insurer doesn't find out right away, lying about cannabis consumption could have adverse consequences later -- including potential cancellation of coverage if the insurer discovers the truth.
When marijuana use is disclosed, many insurers believe this increases the risk of having to pay a claim. Insurers price policies based on risk, and if they view smoking marijuana as a factor that increases the chance of dying during the coverage term, then they will charge higher premiums.
Some insurers actually find the risk to be so great that they will deny coverage to those who smoke cannabis products. This could mean that it is more difficult to find a policy and that those policies that are available cost more, due to the added dangers insurance companies believe that marijuana use presents.
How to get the cheapest coverage as a marijuana user
Whenever a person shops for life insurance and has risk factors that raise the cost of coverage, it becomes especially important to shop around carefully among many different insurers.
Different insurance companies set varying risk profiles and they treat cannabis use differently when determining the likelihood of having to pay out a claim. As a result, there can be wide variation when it comes to what coverage insurers will make available and what price they charge.
One insurer, for example, may deny coverage entirely to people who smoke marijuana, while others will hardly increase premiums at all compared with a non-smoker who has never tried cannabis. Only by shopping around carefully for coverage and getting quotes from several insurance companies can cannabis users find the best and most affordable policy for them.
When shopping around, cannabis users should disclose the fact they smoke marijauna upfront so they can get the most accurate pricing. Choosing a term life policy, rather than a whole life policy, can also help keep coverage affordable as term life insurance is much less expensive than whole life plans. While coverage is in effect only for a limited period of time and no death benefit will pay out unless the policyholder dies during the term of coverage, this is usually sufficient protection for most people since lifetime coverage is rarely needed.
By shopping around and being honest upfront, cannabis users can find a life insurance policy that is within their budget and that provides the protection their families deserve -- even if their marijuana use causes them to have to pay slightly more than their non-smoking counterparts.
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