A glance at all of the ways legal marijuana is going to shake up Canada's insurance industry


Like it or otherwise, legal cannabis is due Canada. If the federal government's newly introduced bills are approved, the changes could be rolled out as early as July 2021.

The legalized substance means major changes for that insurance industry – impacting everything from auto to health and travel.

We did a little digging and spoke with a few skillfully developed to get a sense of what permitted pot will mean for Canada's insurance industry. Here's what we found:

Auto insurance

One of the most popular fears around legal marijuana relates to impaired driving. Will it increase the quantity of stoned drivers on the highway? The way this crime be regulated and enforced?

While there's still confusion around how to test for THC in drivers' systems, and just what the legal limit should be, driving while impaired of the drug – illegal or otherwise – is a surefire method to end you in trouble with the law, and many likely with your insurer, too.

Will regulated reefer create a significant rise in premiums from stoned driving infractions? Or will users turn a brand new leaf and recognize the risks inherent with smoking and driving? We'll have to stay tuned in to see the way it unfolds.

Home insurance

This one gets a bit sticky. Under federal rules introduced in August 2021, tenants are allowed to grow a limited quantity of cannabis, provided they're medicinal marijuana patients.

Nevertheless, home grow-ops – regardless of legality – are viewed as high-risk in-home activities from the perspective of many insurance providers. Andrew McGrath, spokesman for that Insurance Bureau of Canada, explains:

“While regulations may allow for the legal growing of marijuana for medical purposes, it doesn't change the structural risk grow-ops pose to homes and condos,” says McGrath.

“The operation of the grow-op, whether legal or not, continues to be a high-risk activity.”

Will property insurance providers adapt their views and embrace Canada's loosening marijuana laws? It remains to be seen, but a danger is a risk, so it's highly likely they'll remain firm on their current position.

Life insurance

With life insurance coverage, there are signs the underwriting process has already been impacted. Contrary to how marijuana users have been classified for years – as smokers – a number of major life insurance information mill now treating pot smokers as non-smokers, meaning significantly lower premiums.

We spoke to Anne-Julie Gratton, senior consultant of media relations at Manulife, who confirmed the change: “We had already reviewed our underwriting around marijuana use, and marijuana users who do not use any nicotine products or e-cigarettes are called non-smokers.”

Health insurance

Much from the discussion around medical health insurance has centered on whether employee benefits will include medicinal marijuana. Indeed, with the joint announcement by Loblaw Companies Limited and Shoppers Drug Mart that marijuana benefits will be provided to employees, and with the recent decision with a human rights board it ought to be made available in health benefits, the conversation is evolving quickly.

We spoke with Joan Weir, director of health and disability policy for the Canadian Life and Medical health insurance Association, to get insights into the way the medical health insurance sector is get yourself ready for legalization. Here's what she'd to state:

“What we have seen within the legislative framework for recreational marijuana would be that the federal government really wants to follow the medical cannabis route as a distinct route vs recreational marijuana, so at this time we don't' use whatever impact,” she says.

“But I'll state that we're watching it closely, especially concerning the decisionmaking framework, taxation, and how it will likely be distributed,” Weir adds. “Once we all know answers to those questions over the provinces and territories, it might have an impact on driving more people in to the medicinal marijuana stream, or the other way around. That is what we're taking a look at over the next 12 months as the provinces come forth with their own legislation.”

Weir continued to explain the federal government has made it clear that recreational and medical could be separate to have an initial five-year period, then the government will determine if it is necessary to carry on the distinction.

“We expect for the status quo for around five years.”

Travel insurance

Travel insurance coverage is diverse from another types of insurance, for the reason that it's usually purchased just for emergencies, including trip cancellation and medical assistance. Because of that, medicinal marijuana doesn't fit neatly in to the medical emergency structure whatsoever. However, Weir says legal cannabis users ought to be careful about bringing it abroad.

“The only thing that may affect people who are medical marijuana users and who have a permit is the fact that, obviously, if you are going to carry medical cannabis outside of Canada, you actually have to be conscious of the jurisdiction of where you are going – because it may not be legal there.”