Changing marijuana regulations and the link to underwriting assessments

New Australian laws are paving the way for the use of medical cannabis for those suffering chronic and painful illnesses. The Narcotic Drugs Act has been amended to allow legally-grown cannabis for medicinal cannabis products, and while it will be some time before this filters down to an insurance level, the changing landscape of cannabis legitimacy in this country could impact the risk industry sooner rather than later. 

Cannabis medicine is now in the same category as morphine - legal, but controlled - with the new marketplace set to be competitive and lucrative. 

Medical marijuana is not smoked and does not get you high

Contrary to popular belief, the cannabis creeping into the medical landscape is not smoked and does not get anybody high, which is in stark contrast to what is currently happening behind the closed doors of many of those with chronic pain and illness. It is true that these people are already a medical risk, so yes, it does affect their premiums, and not because they like pot, exactly, but because they're sick or injured. 

When administering the highly-refined medical doses, we avoid the risks associated with smoking it (discussed shortly). As medical-grade cannabis use becomes more acceptable and broadly studied, medical-grade cannabis preparations could eventually find their way into your local vitamin store, causing even further categorisations of risks. Taking cannabis in some form could eventually be just like taking any other herbal supplement. 

This means the way we talk about the risks of cannabis must be distilled into their distinct delivery groups - we can't simply lump pot smokers with medical marijuana preparations, however healthy anyone may be at the time. The differing forms of cannabinoid delivery and their components must be separated and their risks assessed individually. Most people tend to favour one delivery method over another. 

'Non prescribed' cannabis use

Cannabis, both recreational and for medical reasons, is still illegal most places, though state-based laws remain. There are some very real risks involved in smoking cannabis, but there are also a lot of misconceptions we all stand by for no good reason. There are some contrasting views on marijuana perpetuated by its legal status, and not as much by science.

Nobody except law enforcement and parents take pot smoking very seriously; not a very scientific perspective, and not useful for analysing risks appropriately. There are risks, but they aren't the same risks that most people associate with cannabis use. 

What we're discussing in this article are the real and perceived impacts of the different forms of marijuana use, how the line will be blurred further with the introduction of medical cannabis preparations, and what this could mean for insurers. 

How pot-smoking is treated by life insurance companies

Risk insurance is unlikely to be denied because of recreational marijuana use in Australia, but it is very much assessed on an case-by-case basis. Insurers use the veiled 'tobacco and other smoking' or illicit drug use categories as an indicator of risk, with question vaguaries implemented to circumvent the illegality of drug use in Australia, offering applicants a way to confess without really confessing. It's a curious little grey area for applicants. 

If applicants even bother to tell the truth (which is the legal thing to do, but not necessarily the correct course of action practically speaking), they will probably be penalised for it. This is because they will be at minimum lumped in with regular smokers, whose risk profiles can differ significantly, as we'll discuss, or worse, considered a 'drug user' of some kind, even if use is minimal. 

Pot-smoking can be considered within the context of harder drug use, though this is less likely unless there is reason for it. Nobody, it seems, truly believes that marijuana is the same as heroin or cocaine, but it is understood to be a companion drug: people sometimes use many types of drugs, and that is then considered as a behaviour. 

There is no facility for establishing how marijuana is taken on application forms, including low-damage forms of use like vapourisers and edibles, and this matters. It might not matter on the grand scale of things - there are checks and balances in place to account for lifestyle omissions - but underwriting relies on science to make informed choices about risks, and this is why cannabis profiling needs to be kept current as things change. 

Cannabis may end up with its own questions on application forms, because in truth, its risk profile is unique compared to harder drugs and tobacco, and is in fact dependent on several factors. The research pool is growing, so by the time we're ready as a country to accept marijuana use more broadly, there'll be a good set of data to draw from. 

The impacts of recreational marijuana use

Recreational marijuana use is a low-risk activity in terms of adverse health outcomes. Nobody has ever died from a marijuana overdose, simply because it's impossible: cannabinoid receptors are not located in the brainstem areas that control breathing (unlike opioid receptors), so despite probably feeling pretty sickly, you can't OD.

People use pot differently - Janet may smoke a joint once a month, climb a mountain and connect with her spirit animal with water colours, while Jack might use it to curb the edges of his downer after two days up on meth. The context is the bit insurers are interested in, and rightly so, but what is also valuable in terms of risk insights is the method of delivery, and what risks people actually face based on that. 

Airway diseases seem the most obvious - but are not necessarily

Smoking pot does affect the lungs, but not how you might think. The research linking pot smoking to cancer, including lung cancer, is scant and the results are mixed. It seems that marijuana smoking may carry a far lower risk of lung and other cancers - there has been no strong association found, unlike tobacco. Additionally, some cannabinoids are actually anti-carcinogenic, meaning they have a protective effect on the lungs.

That is not to say there is no lung cancer risk for pot-smokers - there is - but the risk of other cancers doesn't really exist. A New Zealand study found each joint-year of cannabis smoking increased the risk of lung cancer by eight per cent, whereas tobacco smoking increased it by only seven per cent, but in fact this finding is uncommon - most often, cannabis use is not associated with an increased cancer rate.

This may be due to joints being unfiltered, smoked far less often than cigarettes, but containing many of the same carcinogens. One recent study found that those who smoked pot were less likely to have cancers of the head and neck than those who did not. Cell damage does not tend to equate to increased cancer risk with cannabis smoking, despite theory that supports this - smoke in lungs equals cell damage, and cell damage leads to increased cancer rates. 

A 2015 study found that even long-term cannabis use did not have a detrimental impact on pulmonary function. In 2013, a university professor said in a journal article that cannabis smoke (without tobacco) doesn't appear to increase chronic obstructive pulmonary disease (COPD) or airway cancers. This is important, but seems inconceivable if you look at cannabis from a naughty drug-user perspective (how can they get away with that!), however it's very interesting from a risk perspective. Pot smokers seem to get away with a lot more than you'd think, and in more ways than one. 

So, if you just smoke pot with no additions (as in, you grew it at home and know what's not in it), the risks are negligible when it comes to airway problems. This is good news, but problematically, most Australian pot-smokers chuf a mixture of tobacco and marijuana, so the risks become more or less the same as the equivalent tobacco smoking. The addition of tobacco to pot appears to be a cultural difference - for example, New Zealanders smoke 'green' (pure) cannabis, while Australians and the Brits smoke their pot mixed with tobacco, with all doing so religiously, nationwide. 

An additional and unaccountable-for problem is that many 'commercial' drug dealers are  fond of enhancing the appearance or aromatics of their product with fly spray, hair spray, window cleaner, insect repellent and other toxic chemicals. We can't delve into that here, but it can't be good for your lungs, cannabinoids or not. (Organics, anyone?) Those compounds are so poisonous, having standardised production will, in future, count for something. 

Delivery method matters

The method of smoking makes a difference: bongs, a pipe, joint, or a vapouriser. Bongs introduce water into the lungs, and usually give regular bong smokers their classic ragged, persistent cough, despite offering smoke filtering; joints and pipes introduce dry, hot smoke and carbon into the lungs directly; and vapourisers clean the whole thing up beautifully. Vapourisers have actually been called by researchers a 'safe and effective' mode of delivery of cannabinoids, while the other forms of smoking didn't get such a seal of approval. You can also eat, and rarely, inject cannabis preparations, and avoid the lung cell damage. 

Mental health impacts

Marijuana does have some well-known negative cognitive side effects like paranoia and agitation. Cannabis use also increases the risk of mental health problems, especially in young people, including the development or triggering of schizophrenia and psychosis. This is where a lot of risk lies for insurers, since the research results are very mixed and it isn't easy to tell who might be negatively affected - as it turns out, studies are showing that psychotic responses to pot smoking are mostly genetic, information that nobody has access to at this stage. 

If you have the AKT1 gene, the risk of developing psychosis with daily cannabis smoking is seven times higher than those with the T/T variant, who are unaffected (in this way) by daily marijuana use. The COMT enzyme, also affected by cannabis, has been found to influence psychotic episodes, since it is also related to neurotransmitter function.  Other research shows that starting age, a personal history of trauma, or a family history of psychiatric disorders, and these genetic factors, can contribute to adverse psychological outcomes from cannabis use. 

Driving laws and the logic chasms that lay beneath a real risk

Then, we have the driving conundrum. Australian drug-driving laws have seen world-firsts in terms of strictness and policing, with any detectable blood levels being triggers for charges. This isn't always fair, considering that 'being impaired' and having drugs in your system are two different things that are being treated in a blanket fashion by authorities. Alcohol is passed through your system at a greater, more predictable rate, so applying this to slowly-metabolising drugs creates an apples-oranges scenario that ignores biological realities. 

A major issue with driving under the influence of cannabis is the perception of how 'serious' it is, on the scale of things. Users don't think being stoned matters, that it's insignificant, or in fact that it makes them a better driver.

Fast facts

  • There are 24 million people living in Australia
  • A million Australians admitted to using cannabis in the past year
  • 750,000 say they use it weekly
  • 300,000 say they smoke it daily
  • Australia smokes the most pot globally - 15 per cent of all pot smoking
  • In one Australian study, only 30 per cent of cannabis users said they thought driving after smoking was dangerous, compared to almost 80 per cent of non-users.

There isn't a great deal of research being filtered down to the dope-smoking masses to prove this misconception wrong, unfortunately, however if so many Australians use marijuana at least occasionally, and it is found in the systems of 15 per cent of all road fatalities, the perception problem we face is our first hurdle, and a contributor to higher overall risks for pot-smokers and everybody else on the road. 

An American study found that those with THC in their blood had a 25 per cent higher chance of an accident, but someone with a 0.05 (our legal limit) blood alcohol concentration (BAC) reading had twice accident risk as a sober person. 

Cannabis intoxication is harder to measure than alcohol, and while Colorado has enforced a 5ug/ml limit on drivers, this DUI limit is controversial because there simply isn't an agreed-upon THC blood level where by someone becomes 'impaired', and many argue that limit is too easy to hit - yet another indicator that marijuana policy has, sadly, never been driven by science. 

The driving stats

What is known is that smoking pot reduces the effectiveness of your peripheral vision, impacts your perception of time, balance, hand-eye coordination, and decision-making. Our ability to perceive the speed changes of other vehicles is also problematically diminished. 

Monash has studied driving and cannabis use, and in their report, Cannabis and Road Safety, found that the main error stoned drivers make is lane-weaving behaviour and slow reactions. When booze and pot were mixed, the results were even worse. 

But at what blood level do these negative effects actually kick in? Drivers are allowed to have some alcohol in their systems, despite the high road accidents and deaths linked to alcohol, and a safe level of blood alcohol was determined via research. It is now widely accepted that someone can drive safely with some alcohol in their system, and many argue that the same should be true for THC, but the fact is, the research does not yet exist with any consistent outcomes and marijuana is illegal. This means the zero-tolerance policy suits the powers that be, at least for now.

While this debate on its own means little to most people, insurers must take into account the driving habits - and lack of standardised measurement of impairment - on pot smokers. 

The misconceptions

  1. Because alcohol makes you a more reckless driver, all drugs have the same effect.
  2. Because a stoned driver is less reckless, they are by default a safer driver. 
  3. Because a stoned driver goes slower and is more cautious, they are by default a safer driver.
  4. Because marijuana is found in the systems of 15 per cent of traffic fatalities (and higher for injuries), it contributed to the accident.  


This is an issue that insurers come up against all the time and must factor into premiums, and it is used from time to time to deny claims and cancel policies. When it comes to pot use, it can be impossible to know if someone has lied, unless evidence is later discovered, for example in previously unseen medical records, and blood or urine tests. This means insurers have to have the buffer zone of non-disclosure, which everyone pays for in some way or another. 

Non-disclosure does not automatically mean the policy is cancelled, since there are some areas where the line is blurry, and it may just mean the policy is adjusted to what it should have been with proper disclosure at underwriting time. 

Impediments to accurately measuring cannabis risk in Australia. 

We need to be able to measure the true impacts of cannabis use, taking into account the variety of ways in which cannabis is ingested, both now and futuristically, and have a standardised measure of impairment.

Our misguided ideas about cannabis are only hindering the process of adequately weighing risk factors, disallowing transparent questioning, and intermingling evidence, legality, and perception.