It has been four years since cannabis was first legalized forrecreational use in Colorado and Washington,followed by Alaska and Oregon.

In that time, the insurance industry has learned a lot about howcannabis usage affects business insurance in those states.

To start, questions about employee rights, the legality of drugtesting post-hire and other human resource questions should behandled by a qualified labor attorney or human resourcesprofessional. However, as an insurance professional, I can advisethat employee use of marijuana on the job may affect your insurancepolicies and premiums.

Related: Study: 1 in 5 small businesses would allow medicalmarijuana use at work

Here's are three ways allowing on-the-job use of marijuana couldaffect your insurance premiums and cost of doing business:

A company's drug policy and number of claims will impact itsability to obtain or renew bonds. (Photo: Shutterstock)

Can you get insured or bonded?

As the legalization of marijuana continues across the country,insurance companies may begin to include questions about drug-freeprograms and marijuana usage on applications as part of theunderwriting process. A strict company policy on these issues willmake these questions easier to answer.

An employer's main concern should be providing a safe workenvironment that also allows for the completion of projects in atimely manner. Recreational marijuana usage by employees may affecta company's ability to do so.

Related: Are you considering employee drug testing? Threequestions to ask first

Failure to perform as required by contractual obligations mayresult in your bonding company nonrenewing your bonds. Findingreplacement bonds when nonrenewed for this reason may not bepossible, or may come at an increased cost.

Large or frequent claims may result in nonrenewals ordeclinations of coverage by liability insurance companies, as well.Impaired employees can contribute to both of these, costingemployers in increased insurance premiums for anywhere from threeto five years from the date of loss.

Employers with a drug-free environment may receive a creditsto help lower workers' compensation premiums. (Photo:Shutterstock) 

How will your workers' compensation coverage beaffected?

If an employee is injured on the job, workers' compensation willpay even if that injury is due to impairment. In the event of amajor injury or a series of minor injuries, the insurance companywill send loss control consultants to your business. Theseconsultants will determine any safety hazards that contributed tothe injuries and make recommendations for changes to make a saferworkplace.

Related: Medical marijuana: A growing issue for employers inWorkers' Compensation

One large claim or many small, frequent claims related tomarijuana or other drug use can cause a policy to be nonrenewed.Finding other coverage in the private market after nonrenewal maynot be possible, leading an employer to seek coverage from thestate insurance fund. This coverage is sometimes 200 to 300 percenthigher (or more) than in the private market. In states where thestate insurance fund is the only workers' compensation insurer,premiums may also be heavily surcharged.

Make sure your drug program isup-to-date and complies with all state and federal regulations.(Photo: Shutterstock)

Is your drug-free program obsolete?

A private workers' compensation insurer cannot refuse to insurean employer for lack of a drug-free program. However, most workerscomp insurers offer a drug-free workplace premium credit. Withoutthese programs, you will likely pay higher premiums.

The bottom line

If you wouldn't allow an employee to perform their job dutiesunder the influence of alcohol or while taking mind-alteringprescription medications, then you won't allow them to performthose duties while under the influence of marijuana.

Allowing impaired employees on the job may result ininjuries and property damage that will eventually lead to higherinsurance premiums in the event of claims. Bodily injury andproperty damage caused by impaired employees can also result infines by OSHA or other safety organizations. Your workplace mayeven be shut down, depending on the severity of the injury ordamage.

An employer's first obligation is to provide a safe workenvironment for all employees. A human resources professional oremployment lawyer can review your current employee manual tospecifically address marijuana usage in the workplace.

Galen Hayes is president of ElSobrante, California-based HayesInsurance, a full-service commercialinsurance brokerage and risk management firm. Email himat [email protected]. Opinionsexpressed in this article are his own.