Life Insurance and Marijuana: What Applicants Need to Know

Looking at the table above, if you’re a young 30-something applying for life insurance to provide financial protection for your family, selecting the wrong insurance company might mean you pay $46.25 per month instead of just $13.74.

The truth is that some life insurance companies are much more lenient with marijuana use than others. Choosing the wrong provider could lead to spending hundreds of extra dollars on premiums every year.

Example:

James and Ben, both healthy 33-year-old males, enjoy smoking marijuana 1-2 times per week to relax after a long workweek. Neither of them uses other tobacco products.

James, an accountant at a local sporting goods store, seeks to purchase a 30-year term life insurance policy for $250,000. He applies through a friend who is an insurance agent and is offered Preferred Smoker by his friend’s company. Unaware that he might find a better deal, James accepts the policy at a cost of $70 per month.

Ben, a graphic designer, is friends with James and shares the same marijuana consumption habits. Unlike James, when seeking the same 30-year $250,000 term life policy, Ben consults an independent life insurance broker. The broker helps Ben find a Preferred Non-Tobacco risk class with a different insurer, resulting in a monthly premium of only $24.

Both friends were in the same situation but took different approaches to purchasing life insurance. As a result, James ends up paying nearly triple the monthly premium that Ben does.

This scenario underscores the importance of thoroughly researching and understanding the various options available, as it can lead to significant savings in the long term.

Best Life Insurance for Marijuana Users

If you use marijuana and are seeking life insurance, it’s advisable to work with a broker. Since underwriting guidelines can change, a broker stays updated with the latest rules from various insurance companies, ensuring you find the best coverage to fit your needs.

When choosing life insurance, you’ll typically select between term or permanent policies, depending on your budget and specific requirements.

Term Life Insurance: This is often the preferred option because of its affordability and straightforward nature. Term life insurance provides coverage for a defined period, such as 10-40 years. If you were to pass away unexpectedly during this term, your beneficiaries would receive a tax-free death benefit.

Permanent Life Insurance: While more expensive, permanent life insurance offers benefits that term policies do not. Unlike term insurance, which only lasts for a specific duration, permanent life insurance provides lifelong coverage. This ensures that your beneficiaries receive a tax-free death benefit no matter when you die. Additionally, permanent policies often accumulate a cash value that you can access while you’re alive, and some even earn dividends.

Curious about the cost difference between term and permanent life insurance? The table below shows term vs whole life quotes for a male applicant who qualifies for Preferred Plus, the best risk class possible.