Life Insurance for Drug Users

Posted on September 3, 2021

The opioid epidemic is growing in Canada, with more powerful products attracting more users and claiming more lives each year.

Opioids and other street drugs are much more dangerous than recreational drugs like marijuana or alcohol. There's a higher risk of overdose and long-term health effects that can forever change your life. The risks from substance abuse impact not only the user and their family but also their insurance providers.

If you have a history of substance abuse, life insurance can be one of many challenges you face on the road to recovery. But even though getting life insurance for drug users can be difficult, there are still many coverage options available. This guide will explain how life insurance companies handle drug use and overdose, and how you can protect your loved ones.

Substance Abuse Definition

Substance abuse happens when a person falls into a pattern of misusing and overusing drugs. Addiction is a common result of substance abuse, and users have difficulty quitting or reducing the amount they take.

In most cases, substances are first used for recreation, productivity, or coping with stress. Some individuals can control their use while others enter cycles of addiction. There is no telling whether or not a person will start abusing substances, and it can happen to anyone from all walks of life.

Over time, substance abuse will take its toll on a person's social, physical, and mental health.

Relationships with friends, family, and employers can become strained. Users often start to focus on getting and using drugs instead of other activities and responsibilities. They may eventually face legal issues tied to their substance abuse or face serious health issues because of it.

Substance Abuse vs. Drug Abuse

Substance abuse and drug abuse are often regarded as the same thing, but substance abuse encompasses a broader number of vices. Along with addiction to hard drugs like cocaine and opiates, alcoholism also falls under substance abuse.

Life insurance companies are careful about past and present substance abuse. They know there is a greater risk of overdose, infections, and dying from dangerous behaviour, like drunk driving. The more pressing issue is the effect on your long-term health and life expectancy.

If you're currently abusing alcohol or drugs, insurers will most likely deny you for term or permanent plans. You may still be eligible for life insurance if you are in recovery, though your rates will usually be higher if you are approved.

teens on drug addiction

What If Drugs were Used in the Past?

Your rates and approval odds will vary depending on how long you have been sober and the nature of the substance abuse. Underwriting will look at several factors to make their decision, including:

  • Length of time you abused substances
  • Type and amount of substances being used
  • How you took substances (e.g. smoking, injection)
  • Treatment programs (e.g. rehab)
  • History of recovery or relapse
  • Legal problems resulting from substance abuse

They will also pull your medical history to find any health problems related to past substance abuse. Alcohol abuse, for example, has several negative long-term effects that make you more likely to develop heart disease, cirrhosis, and cancer. Life insurance companies regard those as permanent risks that will keep your premiums raised.

Due to the increased risk of death from relapse, providers like to see a long history of staying clean before they will approve you for a traditional life insurance policy.

In Canada, substance abuse in the past 3-4 years will often result in a decline. Some companies may want five or even 10 years of sobriety before approving an application, depending on the nature of the abuse.

What If I’ve Been to Rehab?

If you have gone to rehab to overcome your substance abuse problem, you may want to wait a few years before applying for life insurance. Life insurance companies want to see a stretch of self-managed sobriety after rehab before approving an application. 

How Insurance Companies Look at Different Types of Addicts

General substance use does not automatically mean you will be declined life insurance. Casual drinking and recreational marijuana are not enough to disqualify you from standard life insurance in most cases. In fact, the plans you qualify for can vary widely depending on the substance in question.

Marijuana

Marijuana use was once considered as high-risk as tobacco. Since it was legalized in 2018, insurance companies have become more lenient.

Now, regular marijuana use has little to no effect on your ability to get the lowest premiums. Insurance companies still vary in how they treat marijuana use, with some reserving their best rates for infrequent users.

Although marijuana use is generally accepted, irresponsible use can still affect your rates and approval odds. If you have a record of driving under the influence, underwriters will take that into account.

Alcohol

Occasional drinking is unlikely to get much attention, but alcoholism and risky or illegal behaviour related to drinking will affect your ability to get coverage.

Insurance providers ask several questions to deep dive into your alcohol use. Along with how much you drink, they'll ask about whether you have had to seek counselling or treatment and if it has affected your personal or professional life.

Your insurance provider will look at your medical records and perform an exam to see if you have any health issues related to your drinking. They'll also investigate your driving record for any DUIs.

If you have a history of abuse, you may still be able to get the best rates. You just have to wait a few years.

After 2-3 years of sobriety, your chances of getting approved for traditional life insurance improves dramatically. If you remain sober for at least seven years, you may qualify for a Preferred insurance classification, and you may even reach Preferred Plus if you are in excellent health after being sober for 10 or more years.

Prescription Drugs

Prescription drugs by themselves don't always affect your life insurance rates or approvals, but the conditions they treat can affect it. If you are on diabetes medication, for example, the higher risk of death from the condition will affect your application.

Due to the opioid problem in Canada, life insurance companies view certain painkillers with concern. They may place you in a higher risk category until you are off the prescription and show that you don't have any dependency issues.

Hard Drugs

If you use any illegal drugs or non-prescribed painkillers, life insurance providers will likely deny your application. Like alcohol, providers will need to see several years of staying clean from hard drug use before offering coverage. After 10 years, healthy individuals may be able to qualify for the best rates.

The drugs in question can weigh heavily in a provider's decision. For example, life expectancy disparities between opioid users and other drug users can make providers look at you as a riskier investment depending on what you use.

Why Honesty Is the Best Policy

No matter what substance you use or have used, it's crucial to be open and honest with insurance companies. It will often result in more expensive premiums, but you can rest assured that your money won't go to waste.

In certain circumstances, insurance companies can deny claims if you pass away and have abused substances in the past.

The first two years after applying for life insurance is the "contestability period". It's one of the major reasons that your beneficiaries may not receive a death benefit payout.

The contestability period gives providers a chance to review an application for errors and omissions. If they find out that you were lying about drug use, life insurance companies can cancel your coverage or hit you with higher rates.

Even worse, if you die during the contestability period, your provider may deny a claim if they find out you were lying. This can happen even if your death had nothing to do with your current or past substance abuse. You might die in an airplane crash, but the insurer will still deny the claim because they found out about undisclosed substance abuse.

After the first two years, your death benefit will pay out if you die in that plane crash, even if you did forget to tell your provider about your substance abuse. The exception is if you die in a manner related to your substance abuse, which would fall under "misrepresentation".

Misrepresentation can come up no matter how long you have had the policy. Most companies cover accidental overdose, but if you didn't mention a past history of abuse and they find out, your insurer will deny the claim. This also applies if you got in a drug-related accident, like crashing your car while drunk.

Types of Life Insurance for Drug Users

Can You Get Life Insurance for A Drug Addict?

Life insurance for addicts is available, but standard policies usually are not. Instead, drug users can get group coverage through an employer or seek guaranteed acceptance life insurance.

Guaranteed life insurance is more expensive and often has lower coverage amounts, but it's easy to qualify. Anyone can get it, and they don't need a medical exam. You will usually only have to fill out a questionnaire.

Compare Life Insurance Policies

Life insurance for drug users can be hard to get, but there are often more options than people realize. If you're in recovery, or even currently using drugs, you may still have stakeholders in your life who depend on you. To protect your loved ones, start a conversation with an agent or provider to learn more about your options.

If you have questions about life insurance with a substance abuse history, Insurdinary is the place for answers. Our insurance experts can help you compare quotes and find the perfect policy to fit your needs and your circumstances. Contact Insurdinary for more information or get started on a quote today!

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