Why life insurers are divided on marijuana use

“Despite a legalization movement across the country, scientific studies on the long term effects of marijuana use are mixed,” says Munich Re Vice President of Underwriting and Medical Bill Moore. “As a result, the life insurance industry is left with more questions than answers, making it crucial for companies to manage risk appropriately.”

Among the nearly 150 underwriters surveyed, 36 percent believe marijuana users are non-smokers despite growing concerns around respiratory issues. Nearly half (49 percent) of the underwriters polled believe there is no difference in risk between underwriting a marijuana user who smokes the drug and a user who ingests it. Additionally, 43 percent say smoking marijuana presented more risks than ingesting it, while only 8 percent viewed ingesting marijuana as more risky.

From an underwriting perspective, 43 percent of respondents believe frequency of use is the most important factor when underwriting marijuana users, followed by an individual’s medical history (37 percent), age (14 percent), and current state of health (6 percent).

“Historically, life insurance companies and their underwriters have erred on the side of caution with respect to marijuana use, given the uncertainty surrounding the drug,” says Moore. “However, as our survey results indicate, a significant number no longer jump to classify marijuana users as smokers. Instead, they are placing a strong emphasis on frequency of use and medical history to determine rates.”