8 Things to Know About Marijuana And Your Insurance

Cannabis has become widely accepted, with two in three Americans supporting legalization, according to a recent Gallup poll. This trend is impacting many industries, spanning government to health and even insurance. With the increased number of users and more states considering legalization, how are insurance companies working to modernize their policies and what should users be aware of?
Marijuana Leaf
Marijuana Leaf Source: Getty Images

At present, only 11 states plus the District of Columbia have legalized the use of marijuana recreationally, though a majority of states have legalized the use of medical marijuana. California and Maine had the highest percentages of medical marijuana patients in 2017, with over 3% of their respective populations having license to use medicinally, according to the Marijuana Policy Project.

In 12 states, it is still illegal to use marijuana in any form, both recreationally and medicinally.

One national study found that men were more likely than women to use both recreationally and medically and become dependent on cannabis. This has implications across different forms of insurance, like auto and life, as gender can play a role in rates.

While the exact legislation and levels of legalization vary state to state, new laws have left many with questions. A once-simple yes-or-no question like, "Are you a smoker?" now has a gray area, as method, frequency and reason you consume could all impact an answer.

Have questions on a specific insurance product?

Health insurance

Health insurance has been known to reward nonsmokers and penalize tobacco smokers with higher rates, as they are more susceptible to smoking-related illnesses. Though the maximum increases under the Affordable Care Act vary by state, increased health insurance rates for smokers could be as high as 50%. Health insurance penalties for marijuana users, either recreationally or medicinally, remain unclear — especially when needing to bucket yourself in a general form.

Do I check "smoker" on health insurance forms if I only use marijuana?

Use your judgment, but many health insurance companies currently identify a smoker as a tobacco product user who engaged with the product four times per week for six or more months, consecutively.

Most insurance agencies define tobacco products as:

  • Cigarettes
  • Cigars
  • Pipe tobacco
  • E-cigarettes or "vape"
  • Chewing tobacco
  • Snuff

It is advisable to read the fine print and check with your specific insurer if you believe you may use a product by the defined threshold or if the language seems like it may include marijuana.

Does my health insurance cover medical marijuana if recommended by my doctor?

Cannabis products are currently classified federally as a Schedule 1 controlled substance, which means there are currently no accepted medical uses and a high potential for abuse. Due to this federal classification, even though a majority of states have legalized the use of marijuana in medical treatments, patients will have to pay for it out of pocket at the dispensary.

Can my Health Savings or Flexible Spend Account fund my medical marijuana?

Medical marijuana has been found to provide relief against medical conditions such as nausea, chronic pain and muscle stiffness. Typically, this type of medical relief qualifies for reimbursement. However, marijuana is still illegal under federal law, so regardless of whether it is legalized in your home state, it is ineligible.

Auto insurance

Driving under the influence applies to alcohol and both legal and illegal drugs, including prescription and over-the-counter medications.

Not only were men found more likely to use, but men were also 47% more likely than women to drive under the influence of marijuana, according to a 2017 National Survey on Drug Use and Health.

The Governors Highway Safety Association cited that 44% of fatally injured drivers in 2016 tested positive for drugs.

Law enforcement is still working to standardize examining a drug-impaired driver. Adding to the difficulty, the side effects and physiological reactions can result in a misdiagnosis at the time of the event. The U.S. Department of Transportation’s National Highway Traffic Safety Administration has taken strides to combat drug-impaired driving, providing specialized training and equipment for field sobriety testing.

One way that Canada, where cannabis use was legalized in 2018, is addressing impaired drivers is by introducing stricter impaired-driving laws: Law enforcement can test any driver who has been stopped, and, if found guilty, the penalty is now a maximum of 10 years.

Safety concerns

Driving after using marijuana can decrease the individual's ability to make sudden decisions while traveling and increase the risk of an accident.

As the number of states legalizing marijuana for medicinal or recreational purposes rises, the debate over how legalized marijuana affects driving will continue. It is likely that over time, standardized tests will become available, and states will continue to create new legislation that limits driving while under the influence of pot in order to minimize accidents and fatalities.

Is it illegal to drive while high?

Yes. If a substance impairs your ability to drive, it is illegal — whether impaired by alcohol or drugs. This includes recreational drugs like marijuana as well as prescriptions. Compared to alcohol, which has a legalized intoxication metric, drug impairment is harder to identify.

In many places, no matter the level of THC, law enforcement officers can conduct an arrest based solely on observed impairment.

What happens if I am caught driving high?

Similar to how medicinal and recreational marijuana usage varies state to state, penalties for a marijuana-related DUI also vary widely. Law enforcement relies on a variety of methods to understand the impairment levels, such as field sobriety tests, chemical testing or the expertise of a drug recognition expert. If the DRE officer deems that the driver is impaired, they are brought to the station for a 12-step examination and potential toxicology test.

Like alcohol, previous convictions play a role, as the penalty can range from license suspension to substance abuse treatment and probation.

If driving under the influence of drugs results in injury or even death, your penalties and car insurance are likely to increase, as insurers see these drivers posing a greater risk and impacting their driving record.

I received a DUI for drugged driving. What are my options?

After receiving a DUI, drivers are often required by the courts or state to file an SR-22 certificate of insurance to reinstate their license. This proves that a driver has the required amounts of liability coverage on their auto insurance policy and are able to pay for damages they may cause.

Life insurance

Tobacco mokers have been found to pay an average of 215% more for life insurance coverage than nonsmokers, though it's not clear whether marijuana use has the same impact on your life insurance rates.

I smoke marijuana medicinally. Will it impact my life insurance policy?

The reason and/or condition for the medical use should be identified to help determine the rate implications. If the condition the marijuana is used to treat is severe, that might impact rates.

In some cases marijuana users are offered nonsmoker rates. For example, those who use marijuana to assist occasionally in mild insomnia may not see increased rates due to the nature of their condition.

I smoke marijuana recreationally. Will it impact my life insurance policy?

Frequency and quantity will play a major role in determining if a user will be held to increased tobacco rates. Other risks will also be assessed, as these might be associated with recreational use related to alcohol, other drugs and lifestyle concerns.