Life Insurance Industry Is Trying to Cash In On Cannabis Smokers

The New York Post reports that marijuana smokers face increased premiums as insurance companies are beginning to put pot smokers in the same risk category as cigarette smokers.

Even if you’re a medical marijuana patient with a doctor’s recommendation, using cannabis can sharply raise the premiums on many life insurance policies, reports the New York Post. Certain companies are charging pot smokers the same risk assumptions as tobacco smokers, despite mountains of evidence showing cannabis is less harmful than cigarettes. Currently, eight states and D.C. have legalized cannabis for both medical and recreational use.

Cannabis users can pay as much as five times the cost for a 20-year, $1 million life insurance policy as non-smokers, according to one broker.

The increase in premiums and assumed risk comes as eight U.S. states and the District of Columbia have legalized the drug for both medicinal and recreational use.

Although the federal government outlaws marijuana, a San Francisco federal judge ruled that the federal government cannot interfere with state laws permitting medical marijuana.

Mark Maurer, president of the independent insurance agency LLIS in Tampa, Florida, said that while some policy issuers will jack up life insurance rates for marijuana users, they would not necessarily turn down an applicant for coverage.

Some insurers treat marijuana differently and may not consider stoners as risky as tobacco users. Since life insurance rates are mostly based on your age and health condition, the underlying medical reasons for why you use cannabis in the first place are what insurers may find the most relevant and take into account.

While insurance rates may fall in the long-term, right now the life insurance industry is trying to cash in.

Now might be a good time to look at how our pot use affects our insurance policies, if we’re lucky enough to have any.bA personal finance expert, who published an article in US News, recently shed some light on the topic.

Let’s Start with Auto Insurance

As we also know, scientists and researchers have been hard pressed to come up with a mechanism for determining how stoned is too stoned to drive. Why? Because THC is fat soluble, whereas alcohol dissolves in water, and that changes everything.

While there is no equivalent breathalyzer test for weed, if you get charged with a DUI for stoned driving, you will most likely see a huge spike in your insurance rates or get dropped altogether.

Home Insurance

If your weed is stolen or gets damaged from fire or water, are you covere

Some home insurers protect you from marijuana loss in states where both MMJ and recreational weed are legal. It can be viewed like any of your other belongings and be covered against certain threats, such as fire, theft and windstorms.

Even pot plants can be covered if you’ve got a state license and don’t exceed legal limits. However, the amount you can claim for missing or damaged marijuana is unclear and could require negotiation with your insurer. That sounds like fun.

In states with low possession limits (like a couple of ounces), insurers are less likely to push back and fight weed-related claims that could be less than $1,000.

Renters Insurance

If you possess weed and have renters insurance, you’ll get the same protection as home insurance, as long as it’s legal.

Health Insurance

Because weed is Schedule I, you can’t claim the cost of medical marijuana for reimbursement, nor can you buy it, with your heath insurance. Maybe someday.

Business Insurance

If you run a legal business in the marijuana industry, coverage for liability or workers’ compensation may be difficult to get, or may come with high premiums because the industry is so new and insurance companies don’t have much experience yet to draw from in order to fully understand their own exposure to risk.