Fact Finders: Will recreational marijuana impact auto insurance rates in Missouri?
Voters will decide the issue in November.
SPRINGFIELD, Mo. (KY3) - Missouri Governor Mike Parson’s comments on the recreational marijuana ballot issue are making headlines across the state. He says, “I think that thing’s a disaster.”
Since the issue is in the news, one of our viewers wrote, “I’m concerned that if the leisure marijuana passes in November, our auto insurance rates will go up. What’s the experience in other states? Did rates go up?”
Voters will decide the issue in November. The proposal would make marijuana legal for adults over 21 to purchase, possess, consume, deliver, manufacture and sell for personal use. It would also allow most people with non-violent marijuana offenses to get out of jail, probation, or parole and have their criminal records cleared.
As for auto insurance rates, we contacted insurance commissioners in Colorado, Washington State, and California to ask about their experience with auto insurance rates after recreational marijuana passed. Vincent Plymell with the State of Colorado, Department of Regulatory Agencies, Division of Insurance responded. “The rates are determined based on losses and expenses,” Plymell explained. “And while they get into risk, the companies don’t drill down to the detailed reasons for the losses in their filings with us.”
We also contacted several insurance companies and insurance industry groups.
The Insurance Information Institute sent us several articles, including this one. The III blog says, “Legalization of recreational marijuana use was correlated to a 6.5 percent growth in the rate of crashes involving injuries and a 2.3 percent rise in those involving fatalities. With legalization and retail sales, the study found that the total impact was a 5.8 percent rise in injury crash rates and a 4.1 percent increase in fatal crash rates. But these results were inconsistent across states.”
The Insurance Institute for Highway Safety agreed to an interview.
“We’ve done the studies since 2014. And the results have been consistent. We see about a five or 6% increase in crash rates in the states that have legalized recreational use. So we started studying the first states that legalized recreational use. We looked at the most recent study. We looked at California, Nevada, Colorado, Washington, and Oregon. And we’ve seen an increase in both injury crashes and insurance claims from crashes,” commented Russ Rader of the Insurance Institute for Highway Safety.
The organization has not studied the impact on insurance rates. Rader says it’s complicated by the fact the states regulate insurance rates. But, in general, insurance rates go up when crashes go up. He also mentioned that if you consume marijuana while driving and you crash, your rates will go up just like rates go up for those drinking and driving.
I also reached out to the group supporting the proposal in November. They’re called Legal Missouri. They pointed me to an article by GetJerry. That company is a car insurance comparison service. The article says car insurance premiums are almost identical in states where marijuana is illegal compared to states where it is legal.
So, for our question, “Did rates go up?” I’m not seeing clear-cut evidence that you can count on rates going up, say, $5 a month. I am learning that you could hurt others if you use marijuana and drive. And, if you crash and survive, you’ll pay the price in higher premiums. So, until more evidence comes in. We’re leaving this one in the middle and not saying yes or no.
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