Legalized Recreational Marijuana Raises Insurance Concerns

Marijuana Plant

The legalization of recreational marijuana is picking up steam across America as more and more states allow the drug to be sold legally to those 21 or older in age. Recreational marijuana as an industry is ready to boom once it is legal in every state, with a predicted $146 billion worth in the global market by 2025. Such a large, new industry breaking onto the American market will have many unknown ramifications for driver safety, consumers’ health, and businesses involved in cannabis production as well as their employees’ well-being.

Personal health and safety issues

One of the concerns is the effect on car accidents, and as a result, auto insurance rates. According to the Centers for Disease Control and Prevention, driving while under the influence of marijuana, much like alcohol, negatively affects several motor functions needed to drive safely. Reaction times and decision making are compromised. Research shows that the risks are even greater when marijuana is combined with alcohol use.

It is also hard to test drivers for marijuana effects on the road. If a police officer pulls someone over for speeding, they can test the driver for marijuana usage via a saliva test. Unfortunately, a saliva test only reveals whether that person has used marijuana somewhat recently, not whether they are actually still experiencing the effects of the drug.

Another consideration, as the legalization of marijuana continues to spread, is the impact on health and life insurance. Potential health issues from marijuana use, especially by teens, whose brains are still developing, raise questions about risk factors assessed for insurance coverage. Will marijuana users have to pay higher life and health insurance rates?

Industry adjustments

In addition, the marijuana industry will need to prevent and mitigate problems related to the safety of employees involved in production and processing. Potential issues include mold exposure, pesticide use and other conditions that could result in workers’ compensation claims. Like other businesses, marijuana growers and producers will face issues affecting property and casualty, general liability, product liability and more.

The recreational marijuana industry will be a massively profitable one, especially if the American market fully opens up, through national legalization. However, there come plenty of potential issues, as with any burgeoning industry. Lives will change and insurance needs will change.

by Jack Mainellis

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