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JONATHAN HAYWARD/THE CANADIAN PRESS
If you took one puff of a joint last year and you apply for life insurance, you will pay smokers rates which are more than double regular premiums.
For example, on Life Insurance Canada.com, I asked for smoker and non-smoker rates for a 34 year old female for $500,000 of life insurance for a 20 year level term. The monthly rates were $22.50 (non-smokers) and $51.30 (smokers).
Typical questions you will be asked when you apply for life insurance are:
“Have you smoked any cigarettes or marijuana in the last 12 months?
Have you used any other tobacco or nicotine-based products or smoking cessation aids in the last 12 months?”
Even if you only smoke tobacco or marijuana infrequently, it is vital to disclose this information. Failure to do so is an opportunity for the life insurance company to contest paying the death benefit if you die.
The key time period is the year prior to making the application. If you smoked several years earlier but stopped more than 12 months before, your rates will not be affected. Similarly, if you qualify for life insurance and start smoking at any time after your coverage is confirmed, your premium rates will not go up for the remainder of the term (i.e. 20 years.)
Why do pot smokers pay as much as cigarette smokers?
The jury is still out on whether or not smoking marijuana causes lung cancer , but Life Insurance Canada.com owner Glenn Cooke says the higher rates are a proxy for higher mortality rates for those taking the drug including:
• Physical and mental effects.
• Risk of impaired judgment (i.e. when driving).
• Reckless behaviour.
• Possible social and financial instability.
• Possible involvement with criminal activity.
If you no longer smoke marijuana but you need life insurance less than one year after you stopped using the drug, Cooke suggests applying for a short-term policy until the end of the year. Then you can request reconsideration at non-smoker premiums and bump up to a longer term or permanent life insurance policy.
“You’ll probably have to undergo a medical examination and fill out a whole bunch of forms. It’s fairly arduous, but in most cases you can keep your existing policy and drop it down,” he continues.
If your marijuana use is heavy (say daily) then insurance companies may have a more difficult time with your application. That’s because your marijuana use may often be as the result of more complex pain management routine. In these circumstances, Cooke recommends disclose of full details to your broker so he can pre-shop your case to underwriters at a few companies.