Maine Residents Face Insurance Woes Due to 'Marijuana Exclusion' Clauses
'Marijuana exclusion' found in fine print of Mainers' insurance policies.
If you're a homeowner or renter in Maine and use marijuana, you might want to check your insurance policy.
The CBS13 I-Team finds you could be without coverage in certain scenarios if marijuana played a factor.
At our "Ask the I-Team" event in Bath a couple months back, a viewer, who asked us not to name her, brought us her renters insurance policy, by a national carrier, and asked us to take a second look.
She wanted to understand what it meant for coverage, especially in a state where marijuana is legal.
"So, my husband caught this and we weren't sure if we read it right. It's a marijuana exclusion," the viewer said.
To summarize, the first sentence of the policy says it will not provide coverage for lost or damaged marijuana.
"I read it and I said, 'Well that doesn't sound unreasonable. I wouldn't expect them to pay back,' but then he was like, 'No, keep reading. Where it says consumption.' I was like, 'Wait, wait, that's different,'" the viewer said.
The second paragraph was more alarming to her, which says the policy will not cover damage or injury caused from marijuana use.
The I-Team took this policy to Maine's insurance head, Bob Carey.
"An insurer isn't allowed to sell a policy in Maine if it hasn't received the approval of the Maine Bureau of Insurance," Carey said.
He says while people might not realize this exclusion is in their home or renters policy, it is allowed under state law.
To understand how the exclusion applies, you must first understand what a renters policy traditionally covers.
There are two main parts to most policies: The cost to replace your property, like furniture or clothes, and liability.
For example, if someone is injured on your property, they can sue you. But under the "marijuana exclusion," an insurance company may not cover you if marijuana was proven to be involved.
CBS13 I-Team Reporter Stephanie Grindley: "Is there a reason why it's specific to marijuana vs. cigarettes or alcohol?"
Carey: "It's just because marijuana is illegal under federal law."
The Insurance Information Institute tells the I-Team because of this gray area between state and federal legality, "If an insurer operates in more than one state, they are especially reluctant to provide coverage."
But Paul McCarrier, with the Maine Cannabis Union, tells the I-Team he is shocked this type of exclusion is allowed in a state where recreational Marijuana has been legal since 2016.
"The voters of Maine approved medicinal and adult use. And the idea that they're trying to say that it's illegal federally, even though they're the state board of insurance that is regulating state insurance companies, is just a cheap copout," McCarrier said. "You know, if this was reproductive health insurance, this could also be a disclaimer for if a woman had an abortion. They could say, 'If you've had this medical procedure, we're going to exclude you from the coverage.' It's so broadly written. It's just a continued stigmatization of cannabis use."
"It's pretty standard," Carey said.
The I-Team found these exclusions can take different forms depending on the policy.
This sample by another national insurance company doesn't specifically target marijuana, but rather "any substance that is illegal...under either federal or state law."
The Biden administration recently made the recommendation to reclassify marijuana at the federal level as a less dangerous drug, which experts say could affect these types of policies.
The I-Team asked Carey if he could see the Bureau of Insurance no longer allowing the marijuana exclusion.
"We have liquor liability. I'm sure at some point there will be recreational marijuana liability where they would be covered. We haven't seen that yet. But, you know, you never know," Carey said.
For now, the marijuana exclusion is out there.
"I don't understand how they'd actually enforce that unless fire marshals come in and said that was the cause. But it's having it there. It's unnerving," the viewer said.
Attorneys the I-Team consulted for this story say it would be very hard for the insurance companies to actually prove denial of this claim in court.
But if you have questions about coverage, the first step is speaking with your agent.
