Although pot has long been treated as more dangerous than tobacco, that's quickly changing. (Photo: iStock)

With just about half of America’s states legalizing marijuana use for medicinal purposes, insurance carriers have changed their underwriting approach for these types of cases.

With the changing times comes a big gray area and a lot of misconceptions. Here are four of them.

Misconception No 1: Marijuana users cannot qualify for life insurance.

Here’s the truth:

More and more insurance companies are loosening up their guidelines relating to marijuana usage.  In fact, most insurance companies will approve an individual who uses marijuana, depending on how much they use, as well as other risk factors. Not to mention, insurance carriers don’t view marijuana the same as they do other drugs such as cocain, methamphetamines or heroin (which result in an automatic declines).

Misconception No 2: Marijuana users will be approved at smoker rates.

Here’s the truth:

This might have been true in the past, but luckily times have changed. Every insurance company views their risk differently, and underwrites every single case individually.  Currently, there are insurance carriers that will approve a marijuana user at non-smoker rates (assuming they don’t also smoke cigarettes and there are no other major risk factors involved). 

Related:

Life insurance: You can lose out just being associated with pot

How to insure your pot-smoking client

Weed users avoid smoker penalties at 29% of U.S. life insurers

Misconception No. 3: Indicating marijuana use on a life insurance application can get the applicant in trouble with the law and/or their employer.

Here’s the truth:

Any and all information provided in a life insurance application is private and confidential thanks to the protection of HIPAA laws. This also includes the results of a urine and blood test if a medical exam is conducted as part of the life insurance application process. Government agencies, including law enforcement, employers and others will not be provided this information. Ever.

Misconception No. 4: It’s best to not mention marijuana usage and hope the insurance company doesn’t find out.

Here’s the truth:

It’s never a good idea to conceal facts or lie on a life insurance application. In fact, if details about marijuana use are not provided on the application, and the insurance carrier’s underwriter finds out (either through medical records, urine test or blood test), it’s possible they can deny the application outright.  It’s best to provide as much information up front as possible, about marijuana usage, and any other information that might be pertinent.

In summary, as states continue to pass legislation as it relates to marijuana usage, insurance companies will continue to change their underwriting guidelines.  Not only can marijuana users obtain life insurance through a private and secure medium, but it can also be extremely affordable.

Related:

The effects of marijuana use on life insurance rates

Marijuana investing: Why advisors should just say no

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