Marijuana and Life Insurance: Your Preferred Rating Doesn’t Have To Go Up in Smoke

The issue of marijuana use continues to evolve no matter where you live.  While your state, like here in California, may have legalized the drug, the federal government still classifies the substance as illegal.

As states push on despite the federal laws, the question of marijuana use is a hotly debated topic inside the insurance industry as well.

So, what happens to the marijuana user when it comes to life insurance policies?  If you’re a tobacco smoker, for example, you will have a higher premium to pay because of the obvious health issues related to tobacco. But what about marijuana?

We recently had such a case.  It was something new, as California only legalized pot use beginning in 2018. In a current application, a fine young man admitted to having recently tried marijuana.  The company’s underwriter immediately bumped the application to a less favorable rating class from a preferred rating.

I called the client, and he told me, “After it became legal, I was offered an opportunity to try it, so I did.”  The client revealed that he hadn’t done it since and does not intend to do it again.

We set out to work on his behalf.

Part of our value is our not being limited to specific policies or insurance carriers.  We’d already done our due diligence and had several other good companies who agreed they’d issue a policy on the more favorable rating.

We went back to the original company and, upon reflection, they agreed to accept the situation and issue the policy at the original “Preferred” rating class.

Problem solved.

Just like the debate between state and federal government, the insurance industry is currently sorting out its views regarding marijuana use.  We’d already benchmarked his proposed policy with the wide range of competitors out there.  Once again, our systems worked.  The client was able to get the best and most appropriate coverage for his family.

The insurance world can be difficult to navigate. Without a clear understanding of their current plan, it’s difficult to be certain that your clients have the right coverage. If you’d like to take a closer look, you’ve come to the right place. We can answer your life insurance questions and provide the clarity you need to sleep easy. Learn more about our services or join our newsletter today. To contact us, call 951-823-8100 or click here.

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