We describe a novel approach to quantifying the uncertainty inherent in the chemical kinetic master equation with stochastic coefficients. A stochastic collocation method is coupled to an analytical expansion of the master equation to analyze the effects of both extrinsic and intrinsic noise. The method consists of an analytical moment-closure method resulting in a large set of differential equations with stochastic coefficients that are in turn solved via a Smolyak sparse grid collocation method. We discuss the error of the method relative to the dimension of the model and clarify which methods are most suitable for the problem. We apply the method to two typical problems arising in chemical kinetics with time-independent extrinsic noise. Additionally, we show agreement with classical Monte Carlo simulations and calculate the variance over time as the sum of two expectations. The method presented here has better convergence properties for low to moderate dimensions than standard Monte Carlo methods and is therefore a superior alternative in this regime.