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How Will Legalized Cannabis Affect Canadian Car Insurance Rates?

April 17, 2019
3 mins
Man in denim jacket on his mobile phone somewhere downtown

Legal recreational marijuana in Canada could affect your car insurance premiums, even if you don't use the substance and have no interest in it. So far, the only auto insurance premiums that have increased are the premiums of people with impaired driving offences. Is this really a change? Drivers found to have marijuana in their bloodstream before Canada legalized cannabis were always identified as "high risk" drivers with high insurance costs. One thing most insurance industry experts agree upon: legal cannabis in Canada will eventually contribute to higher auto insurance rates for everyone.

How Soon Will Insurance Premiums Rise Due to Legalized Cannabis?

Cannabis-related premium increases will take several months and potentially years to implement. Insurance companies must analyze crash and claim data, then present the data regarding crashes and claims risk to provincial insurance regulators before requesting premium increases.

As legalization is still new, Canadian insurers are keeping a close eye on accident statistics from U.S. states which legalized recreational cannabis in recent years to help determine potential risk. One recent study showed that non-fatal crashes had increased up to six percent in Washington, Oregon, and Colorado since legalization, compared to crashes in neighboring states where marijuana remained illegal.

What Are the Facts About Canadians Driving Under the Influence of Cannabis?

In 2018, Stats Canada's survey on cannabis and driving found that about 1.4 million Canadians said they'd been a passenger in a car driven by someone who'd taken marijuana in the previous two hours. One in seven cannabis-using Canadians said they'd driven less than two hours after taking cannabis at least once during the prior three months. Driving under the influence of cannabis was much more common among frequent users (27 percent) than occasional users (six percent). Overall, 4.6 million Canadians, about 16 percent of Canadians over age 15, told Stats Canada they had used marijuana during the prior three months.

Canadian law specifies two levels of THC-impaired driving in addition to its strict drinking and driving laws. THC is the psychoactive substance found in cannabis. Drivers with between 2 nanograms (ng) and 5 ng of THC per millilitre of blood are in the first tier of offence, punishable by a fine of $1,000. The higher level of offence begins at 5 ng THC or more per millilitre of blood. Drivers combining alcohol and marijuana will be cited for blood alcohol levels higher than .05 and 2.5 ng of THC per millilitre of blood.

How much cannabis will cause a THC level over the legal limit? The answer is: at a certain point while smoking, any amount of cannabis can raise the amount of THC in the blood above Canada's legal limit of 2 ng. Because cannabis affects people differently, the amount of waiting time required before driving varies. Guidelines similar to blood alcohol level drinking and driving charts haven't yet been established, but it's likely that the two hour waiting period many Canadians told Stats Canada was common isn't long enough to drive unimpaired.

Whether you're among the 16 percent of Canadians who use legal cannabis or not, the new legal status of cannabis in Canada will affect car insurance premiums in every province.

Insurance rates change regularly, so it's always a good idea to compare the latest auto insurance rates today.


The RATESDOTCA editorial team are experienced writers focused on sharing stories and bringing you the latest news in insurance and personal finance. Our goal is to provide Canadians with the information and resources they need to make better insurance and financial decisions.

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