That is right, effective October 17th, 2018 the Government of Canada is legalizing the recreational use of cannabis, otherwise known as marijuana. The topic has been discussed in the media for quite some time now but has finally come to fruition. But what does all of this mean for you? There are certainly going to be impacts as a result of this legislation that may affect your home insurance policy and your auto insurance policy. Lets have a look shall we!
How Does the Legalization of Cannabis Affect My Auto Insurance Policy?
With so many different insurance companies and options available it is almost certain that they will have different rules and concerns when it comes to marijuana and your auto policy. However, there are a few areas that will impact your auto insurance no matter what company you are with.
The Criminal Code of Canada has been revised to include roadside testing for drugs in addition to alcohol. The legalization of marijuana in other jurisdictions, has resulted in an increase of motor vehicle accidents from drug-impaired driving. Obviously for insurance companies and the safety of our communities this is a concern. The limits of drug concentration are outlined by the Government Canada and you can read more about the changes to impaired driving laws here.
Underwriting and Coverage
Similarly to a DUI, drug impaired driving will also impact your insurance rates and your coverage options. A conviction for drug impaired driving is treated the same as a conviction for alcohol impaired driving. Both of these are considered criminal code offences and the underwriting rules for standard insurance markets allow them to decline coverage. The majority of the high risk markets will have exclusions or reductions in the coverage they offer to you and you will also be subject to a premium surcharge.
How Does the Legalization of Cannabis Affect My Home Insurance Policy?
Insurance companies are also treating home insurance policies very differently. Some companies are excluding the growth of cannabis for recreational or medical use while others are allowing it as long as it meets their specifications. It is difficult to categorize how each and every company will treat the use of cannabis when it comes to your property insurance but it is always important to disclose this information to your insurer.
Risks That Will Not Be Written
Most insurance companies have followed the same guideline when it comes to declining risks who are growing their own marijuana.
- If any person in the household has been convicted or has pending charges for drug trafficking, threats of violence, theft or fraud.
- If the risk has been identified in the past as being a part of, or conducting criminal drug production operations. This includes illegal grow-ops or the manufacturing of illegal drugs.
Risks That May Be Written
Similarly, there have been a good deal of insurance companies who have come forth to support risks who intend on growing their own cannabis. The Government has set out specific limits in Ontario for growing cannabis. You will be able to grow up to four plants per residence, not per person, as long as you are over the age of 19. Should you choose to grow your own marijuana under these requirements there will not be an impact with most insurance companies. However, you do need to disclose that you intend on, or are growing marijuana to your insurer. If you exceed the limits or perform illegal drug operation your policy may be declined or become null and void. You can find out more about how much you are able to grow and the requirements here.
Can I Get A Commercial Insurance Policy For My Medical Marijuana Business?
This is a great question! There certainly are companies who will insure your medical marijuana dispensary or grow-op. For more information head to our commercial insurance page for Marijuana Insurance.
There are a lot of new changes in the insurance world because of this legislation and it can be difficult to understand the ins and outs of the new law as it pertains to your insurance. If you have any questions or are unclear about what is available or how this may impact you, speak with an experienced insurance broker. They will inform you about the risks and provide you with information about the legalization of marijuana.