12 April 2013 0 Comments

Mary Jane

MarijuanaYears ago anyone who admitted to smoking marijuana would, at the very best, be charged the same premium assessed to cigarette smokers.  Today, most insurance companies do not take such a harsh view of an applicant who admits to having smoked “a joint” in the past 12 months.  Though a person who has smoked a single cigarette (tobacco) in the past year is likely to be charged a premium as a tobacco user, paying up to four times that of a non-smoker, the same use of marijuana would not preclude a person’s eligibility as a preferred, non-tobacco user.

So, if you have used marijuana on a rare occasion and consequently are being charged a tobacco user premium, ask your agent to try another insurance company.  When you complete an application for life insurance the smoking of marijuana does not constitute use of tobacco or nicotine, so that question may be answered in the negative if you have not used tobacco or nicotine.   There will, however, be a question pertaining to your use of illegal or controlled substance, so that’s where they catch you on the marijuana.

Be truthful in answering questions asked by your agent or medical examiner.  Failure to disclose the use of marijuana will not only cause a claim to be contested in the first two years, but also label you as someone who might be hiding something else.  Put as good a spin on your use as possible.  Was the use only during a celebratory event; only once or twice a year/month; tried years ago as a student, but totally discontinued now; for medical reasons only; etc.  Read the application before you sign it and make sure that the agent or examiner has entered the information fully just as you stated it.  If the agent knows you personally ask him/her to write a letter to the underwriter verifying your exemplary life style.

As the legalization of marijuana for medical reasons and potentially for recreational use becomes more prevalent, the underwriters are going through a metamorphosis on its acceptability.  Many professionals believe that alcohol and nicotine is much more addictive than marijuana with more adverse mortality consequences.  However, regular and continual use of marijuana will likely result in some negative impact on premiums; either an extra premium charge, preclusion from obtaining a preferred status or even declination of coverage.

Use of marijuana is usually a violation of laws.  An applicant who admits to use on an application need not be concerned about the insurance company turning this information over to legal authorities.  Confidentiality of statements is protected by HIPAA—a federal law. If marijuana was prescribed for medical reasons, the insurance company will investigate how the underlying health situation might affect insurance premiums and eligibility.

Coming up…financial ratings of insurance companies.

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