The demand for cannabis insurance specialists is increasing as general awareness spreads about medical marijuana and the legalization wave continues across the country. One marijuana law professional, Ian Stewart from Wilson Elser Moskowitz Edelman & Dicker LLP, has been speaking at conferences frequently discussing the growing need for cannabis coverage.
Stewart has talked about the need for cybersecurity insurance in the cannabis space considering the vast amounts of data that is being collected from seed-to-sale programs and medical marijuana programs. He has also touched upon the potential of cannabis product liability claims from untested or improperly packaged marijuana products. In an interview by the Insurance Journal, Ian Stewart expounded on some more cannabis business related risks he is foreseeing.
Insurance Journal: What sort of unique or interesting claims do you think that we’re seeing, expect to see, or are we seeing from these cannabis coverages?
Stewart: However, I think that the sort of unspoken danger that a lot of certainly the licensed operators don’t appreciate is the risk of consumer class actions. You know, basically there are cases where a consumer will come in and they’ll by a product that is technically adulterated or mislabeled or contaminated in some way, maybe they’re violating some state regulation, and the state cannabis regulations are really onerous. It’s really hard for operators to be fully compliant.
So, the trick is these lawyers will find a product that is in some way violating a state regulation and then file consumer class action under state consumer protection laws. Frequently those are uninsured or under-insured claims, and they’re dangerous because they have fee shifting where the attorneys can get their attorney’s fees, there’s statutory damages, disbursement of profits. They’re pretty dangerous, and we’re starting to see those get filed now in California and elsewhere.
Insurance Journal: You mentioned something in your talk (at PLUS) about doctors looking for coverage for prescribing marijuana and that you expect that to pick up. How do you see that picking up? Where do you see these doctors going to find coverage, and what sort of coverages are they going be looking for?
Stewart: We’re seeing more and more issues of interactions, you know, overlay where in the past it may have been a patient who just has a drug history of marijuana and cocaine. But now that patient may be adding CBD or marijuana to their panel of medications, and maybe there’s overlay with mental health issues or substance abuse. So, it can be really difficult for physicians now to tread those waters, get informed consent, adequately advise their patients, and in some cases even offer CBD or marijuana instead of opiates, for example.
While access to traditional forms of insurance is a little more limited for cannabis business professionals, as long as you connect with the right cannabis insurance specialists, very good alternatives exist for you. Contact Eric Rahn or David Rahn of S2S Insurance Specialists to find out more.