Life Insurance for
Casual Users and Medical users can enjoy Standard non-Smoker Rates
Big Changes for Casual Cannabis Users and Life Insurance came in 2016
In 2016, as most Canadians and our Government were anticipating the legalization of casual Cannabis consumption, most Life Insurance Companies in Canada were also reviewing their classification of casual Cannabis use. Prior to these decisions it was simple, if you smoked Cannabis, you were classified as a full fledged Smoker by the Life Insurance Companies…
But, in a Study provided to the Financial Post by Dalhousie University they showed that 68% of Canadians supported the legalization of recreational use Marijuana, and would like to see it controlled and taxed as is Liquor. So the Life Insurance companies had to deal with the inevitability, that if an Insurance Company did not penalize you for casual Alcohol Consumption, how could they penalize you for casual Cannabis Consumption?
Why was it so Important that Life Insurance companies relaxed their rules on Cannabis use?
- There are many situations where Cannabis is used as a medical treatment for a number of ailments, and was legalized for Medical Purpose in Canada in 2001
- Socially, Cannabis is consumed by Canadians, similar to having a Cigar on a special occasion, in the most recent studies, approximately 20% of Canadians had smoked Marijuana at least one time in the past year
- Some Bank issued Mortgage Life Insurance Policies would not allow casual use of Marijuana in the past, so getting coverage on your mortgage balance could be problematic, even if it was for medical purposes
- The cost differences between being classed as a smoker vs a non-smoker are dramatic, and as you get older the numbers become even more dramatic
- The rates for a 35 year old smoker for $100,00 of T-100 Life Insurance is $110 per month, whereas a non-smoker would pay only $80. This is a savings of 31% for a non-smoker or potential cannabis user. *
- And it gets worse as you get older, the rates for a 45 year old smoker for $100,00 of T-100 Life Insurance is $180 per month, whereas a non-smoker would pay only $130. This is a savings of over 33%% for a non-smoker or casual cannabis user. *
- And even worse, the rates for a 55 year old smoker for $100,00 of T-100 Life Insurance is $331 per month, whereas a non-smoker would pay only $203. This is a savings of 48% for a non-smoker or cannabis user. *
* Based upon Canada Protection Plan Rates as of April 20 2018
What are some of the Facts about Cannabis Consumption in Canada?
- In 1923 Cannabis was deemed illegal in Canada under the Narcotic Drugs Act
- According to a University of Ottawa study, there are approximately 2.3 million users of Cannabis across Canada
- Annual cost of policing and enforcing Marijuana including court costs exceed $500 million dollars
- Estimated annual costs associated with substance abuse in Canada: $1.4 billion for illegal drugs; $7.5 billion for alcohol and $9.6 billion for tobacco.
- Substance abuse data shows that of all treated patients, 80% were for Alcohol compared to 10% for Cannabis related addictions
- By Regulating Production, end users will have better confidence in using a pure product by prohibiting the use of certain ingredients
- By controlling and taxing the majority of Cannabis products distributed in Canada, the tax dollars can be directed to Addiction and Treatment programs
Should you Review your Current Life Insurance Coverage?
- If you have purchased your Life Insurance before 2017, then it would be prudent to see if you are considered a smoker vs a non-smoker
- Many Mortgage Life Insurance providers have a blended rate for smokers and non-smokers combined, by using personally owned Life Insurance you will get the best rates based upon your health
- Term Life Insurance Rates have declined over the past 5 years, so you may be able to save money, whether you are a smoker or not
- If you had taken Life Insurance while declaring you are a smoker based upon Cannabis consumption then you will save a significant amount of money with the new rules
- If you had put off looking at Life Insurance due to your worry about casual Cannabis consumption you will be fine to apply now
- If you had put off looking at Life Insurance due to your need for Medical Cannabis, then you will also be fine now