How Marijuana Use Affects Disability Insurance Underwriting

As more and more states change their state laws and enforcement related to marijuana use – either recreational or medicinal, marijuana usage is becoming an important factor in disability insurance underwriting. Different carriers take different approaches, so asking your client questions about marijuana usage can help you target the best carriers for the case.

Where Is Marijuana Legal?

Marijuana use is still illegal on the federal level. However, according to the National Conference of State Legislatures, 38 states, three territories and the District of Columbia have legalized medical marijuana as of 2023. Additionally, 23 states, two territories and the District of Columbia allow recreational marijuana use for adults.

Disability Insurance Underwriting for Personal Use

We are getting an increasing number of cases related to clients working in the marijuana industry as well as clients who are using marijuana, either medicinally or recreationally.

The use of marijuana does affect the medical underwriting of a disability application. As the agent, you need to get this type of information on the front end, so there are no surprises once the application is in underwriting.

When preparing a disability insurance application, ask questions about marijuana use:

  • Does the applicant use marijuana?
  • If yes, is the marijuana use medical or recreational?
  • If yes, how frequently does the applicant use marijuana?

Generally, clients with infrequent marijuana use, in the range of one to three times monthly, can expect no modifications. We have at least one carrier that will still offer coverage with use up to one to three times per week but with a tobacco rating. Most of the carriers would use individual consideration with weekly usage and an inquiry with detailed client information would need to be done before quoting. Typically, non-medicinal use is viewed more favorably than medicinal use. If traditional carriers aren’t an option, we do have options with special risk DI carriers.

Disability Insurance for Marijuana Industry Workers and Business Owners

There are different guidelines for those working in the marijuana industry, and securing disability insurance is more challenging. We typically cannot get individual DI coverage with a traditional carrier. However, we do have options for these clients with a special risk carrier.

We also now have options for business insurance as well such as key person coverage, business loan coverage and buy sell disability insurance. These plans are simplified issue and require no labs. The premiums can also be paid by credit card which is an important option as many of these businesses are unable to obtain checking accounts.

Please contact us if you have any questions about insuring these clients!


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