Driving High - The Future Is Hazy For Canadian Automobile Insurers Once Cannabis Goes Legal

Legalized and regulated cannabis is on track to become a reality in Canada in just under a year (on or before July 1, 2018). This will create a number of opportunities as well as challenges for the automobile insurance industry. As discussed in our recent articles The Grass Is Always Greener in the Other Jurisdiction, and Cannabis Act Regulations - Now We Are Really Getting into the Weeds! the Federal and Provincial governments are working diligently to develop a regulatory framework for recreational cannabis, but much is still unknown. Accordingly, the biggest challenge facing automobile insurers at present is the uncertainty legalized cannabis brings.

With Canada becoming only the second country in the world to legalize the possession, production, and sale of cannabis nationwide, information on the impact of legalization on this industry is sparse. This makes it difficult to predict whether legalization will result in an increase in the number of drug-impaired drivers on the road. However, we can consider the results of legalization in certain states, and can look to some existing data for insight.

What the numbers say

A recent study by the Highway Loss Data Institute in the United States has reported an increase in collision frequency of about 3% in states with recreational cannabis - Oregon, Washington, and Colorado - in the years since legalization has taken place. However, the study was not able to definitively link the increased collision frequency with consumption of cannabis. This increase could also be linked to a growth in tourism in these states, or any number of other factors.

In Canada, a recent survey from State Farm suggests that many drivers don't believe driving high is as bad as drinking and driving. In fact, 27% of those surveyed either did not know or disagreed with the idea that driving high was as bad as driving under the influence of alcohol. Additionally, while almost 9 out of 10 Canadians stated they had never driven under the influence of cannabis, 44% of those who had driven high believed it did not impact their ability to drive safely, and 14% did not know if it affected that ability. Lastly, according to the Canadian Centre for Substance Abuse, it is more prevalent for drivers to drive after cannabis use than after consuming alcohol.

With all of that said, a recent New Brunswick Medical Society report states that driving under the influence of cannabis is already prevalent in rural areas, and has suggested that...