Auto insurance premiums decreased in states following the legalization of medical marijuana, according to a new study that builds on existing research signaling that cannabis reform is associated with reduced risk of dangerous driving—contrary to prohibitionist arguments.
The study, published this month in the journal Health Economics, analyzed insurance data from 2014 to 2019. It found that premiums dropped by about $22 per year on average after states enacted legalization—and the study authors think that may have something to do with reduced drunk driving in those states, signaling a possible substitution effect whereby people switch from alcohol to cannabis.
A $22 premium reduction might not seem significant on its face, but the reason for that decline is what’s important. Access to medical cannabis seems to be linked to better road safety, which translates into significant cost savings—both collectively for people paying insurance premiums and overall for health-related expenditures related to auto accidents.
