Tag Archives: Marijuana

Pot is now legal in Canada. What could it mean for homeowners insurance?

As of today, recreational pot is legal across Canada. Two weeks ago, we looked into how pot legalization could impact Canada’s road safety. 

Now let’s talk a little bit about homeowners insurance and marijuana. 

Except for Manitoba and Quebec, all Canadian provinces will let people grow a small amount of marijuana at home – usually up to four plants.  

Unfortunately for the aspiring bud-growers out there, growing pot isn’t as easy as growing basil. Marijuana is a fickle weed and needs a lot of care to grow into a viable plant. It can be grown outside or on the window-sill, but a healthy and vibrant marijuana especially likes a hot, light-intensive, steamy environment – not exactly an accurate description of Canada’s climate.   

Which is why a whole industry has grown up around providing home-growers with hydroponic, lighting, and climate control systems to grow pot indoors, safely tucked away from the blinding snows and sub-zero temperatures of a Canadian winter.  

How will home-grown marijuana affect homeowners insurance?  

Higher risks. Well, for one, these grow systems are definitely not risk-free. High-intensity heat lamps can mean a strung-out electrical system, which can lead to fires. Humid temperature controls mean lots of moisture, which can damage your house with mold and fungi growths. 

Higher premiums. Higher risks mean that an insurance company will probably ask for more premium to make up the difference. A spokesperson for the Insurance Bureau of Canada has been quoted as saying that insurers asking about home-grown pot may become routine: “[insurers] just want an accurate idea of what you’re doing and any risk factors that should go into determining your premium […] they’re going to underwrite your policy based on a number of factors. It’s just another factor that gets consideration when setting an insurance premium.” 

Coverage questions. It’s also important to know what your insurance does and does not cover. For example, some damage caused by mold or fungi is often excluded by a standard homeowners policy. And most policies limit the amount of money an insurer will pay for damaged plants. This limit might not always be high enough to reimburse for marijuana plants, which can be pretty valuable.  

So if you’re a Canadian planning to use a marijuana grow system at home, talk to your insurer – especially if you’ll be installing complicated equipment.

What will legal marijuana mean for Canada’s road safety?

don’t drive stoned.

As you’ve probably heard, recreational marijuana will be legal across Canada come October 17, 2018. Will stoned driving increase? Will this lead to more accidents and fatalities?

We can’t divine the future, of course.  But perhaps we can learn something from the past. Did roads become more dangerous after states began legalizing recreational pot in the U.S.?

The short answer: probably, to some degree.

  • The more stoned a driver is, the more likely she is to be involved in an accident. Motor and cognitive skills are important for safe driving. Getting stoned makes both these skills worse – and the more stoned a person is, the more these skills deteriorate.
  • The number of “THC-positive” drivers on the road increased after legalization. In Washington state, at least. There’s evidence that the percentage of stoned drivers went up noticeably after the state legalized recreational pot.
  • Fatal crashes involving drivers who tested positive for THC increased. Some studies indicate that more people with “detectible” levels of THC in their bloodstreams were involved in fatal accidents after legalization.
  • Collision claim frequency appears to have increased. Early analysis suggests that states with legal marijuana have higher rates of car collisions than they would have had without legalization.

There is an important caveat to all this. You’d think that figuring out when someone is stoned would be easy. It’s not. Unlike alcohol, measuring marijuana impairment is complicated. THC can remain in a user’s bloodstream for days, even weeks, after getting high. Having THC in her bloodstream at the site of an accident does not automatically mean a driver was stoned at the time of a crash.

To make matters worse, to what degree marijuana impacts one person’s driving skills is also not so clear-cut as you’d think. Marijuana impacts different people differently. Researchers are currently trying to figure out how to account for things like THC tolerance when they measure how much marijuana increases crash risks.

But despite these complications, most evidence suggests that stoned driving is a bad idea – it endangers the driver, passengers, and other drivers. For this reason, Canadian provinces have begun revising their impaired driving laws to come down harder on stoned driving.

So what does this mean for road safety in Canada? It’s still too early to tell, but marijuana legalization in the U.S. should serve as a warning.

Americans’ Attitudes about Marijuana Use and Driver Safety Evolve with the Times. A Preview of I.I.I. Research Polling on the Subject

By James Ballot, Senior Advisor, Content Marketing

Americans’ attitudes about pot use have become more nuanced; 29 states and the District of Columbia (accounting for about 62 percent of the U.S. population in 2016) have passed laws legalizing the use of marijuana for medical or recreational use.

There are clear insurance issues to this trend. The Highway Loss Data Institute found that crash rates rose in states where recreational marijuana was legalized. The National Council on Compensation Insurance has a running conversation about how changes in the use of cannabis could affect workers compensation insurance.

While conducting research for a forthcoming I.I.I. poll, some interesting and unexpected trends emerged, including:

  • Most Americans know the legality of marijuana use where they live
  • A slight majority of Americans believe that driving while high results in more motor vehicle crashes

And yet…

  • Americans also voice greater tolerance of drivers who have used marijuana (compared to those who had consumed alcohol)
    • Respondents age 18 to 34 were more likely to say that they would ride in a car with a driver who has consumed marijuana (37 percent), followed by 34 percent of people between the ages of 35 and 44

We’ll release a report with polling results and our key learnings from the data in the near future. In the meantime, the conversation over safety issues related to legal medical and recreational cannabis will find larger, more mainstream audiences. To keep up with these and other discussions, be sure to follow @III_Research on Twitter.

 

Medical Marijuana and Insurers

A Los Angeles Times blog post reports that marijuana lollipops were for sale on the Lakers parade route yesterday.

Apparently a food truck, Weed World Candies.com, was handing out the lollipops for free to customers that had a prescription card allowing them to purchase marijuana.

In addition to the orange and blue marijuana lollipops, the truck carried a variety of marijuana brands, according to the LA Times.

California became the first state to approve medical marijuana in 1996 and this November voters will decide whether to legalize marijuana even without a medical prescription. The liberalization of state marijuana laws is an issue that insurers are monitoring.

A BestWeek article by Meg Green via insurancenewsnet.com reports that to-date 14 states have legalized marijuana for medical use, while another 10 states have medical marijuana initiatives on the ballot this year and insurers are playing a key role in this emerging market. BestWeek says:

Billions of dollars are at stake. Marijuana is the biggest cash crop in California, where it brings in $14 billion a year in sales. That’s almost twice the amount brought in by the state’s second-largest agricultural commodity, milk and cream, which brings in $7.3 billion a year, according to the most recent USDA statistics.

As marijuana moves from the counterculture world into the mainstream, a new wave of businesses — including growers, suppliers, manufacturers, transporters and dispensaries — is emerging, and the insurance industry has taken note.†

As well as an emerging market, the legalization of medical marijuana is a growing employment-related issue with potential implications for workers compensation insurers. Fellow bloggers over at Workers Comp Insider have a number of posts on this topic. Check out an earlier post that provides a great overview of some of the key issues.

Meanwhile, over at National Underwriter Susanne Sclafane writes that employment practices liability (EPL) experts see the use of medical marijuana as a growing issue for EPL insurers. Check out her article here.

The National Conference of State Legislatures (NCSL) has an overview of state medical marijuana laws here.