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Marijuana Delivery Robberies Becoming Commonplace

Since banks remain reluctant to work with marijuana dispensaries, the industry remains burdened with cash for the most part. Needless to say, the liability to cannabis companies that are holding large amounts of cash are obvious. Marijuana delivery robberies are becoming very commonplace in places like California.

In one town close to San Francisco called Concord, police are reporting marijuana delivery robberies are as frequent as four times a month. It only makes sense for these cannabis dispensaries to find the right sort of marijuana coverage to protect against these robberies. Lt. Mike Kindorf with the Concord Police Department recently spoke to reporters concerning these marijuana delivery robberies.

marijuana delivery robberies are on the rise and cannabis product liability is very important

“There’s a significant increase and talking with other law-enforcement agencies,” Kindorf said. “I know that Concord is not alone in that crime trend that it’s occurring in other parts of Contra Costa County as well.”

Because cannabis is still illegal in the eyes of the federal government, California pot sellers are stuck dealing in cash for the most part, which is luring in the criminal element, even more than the drugs.

“In a few robberies that we have they’ve targeted cash and not even touched the marijuana,” said Kindorf.

In December, a driver showed up for a drop off in the parking lot of the Bank of America near the Sun Valley Mall and was robbed by a handgun wielding suspect.

The thief grabbed both the pot and the cash but police later found a duffle bag stuffed with pot products abandoned by the side of I-680.

Concord Police believe that it’s a crime that’s underreported and even in the cases where police are called in, the victims often don’t want to cooperate.

“Even though it’s legal it seems to be a little bit of an off the grid business,” Kindorf said. “It’s kind a virgin territory that we’re in for sure.”

For instance in that armed robbery that happened near the Sun Valley Mall, police have a suspect but they’re having a hard time getting the victim to call them back so we can make a positive ID.

The financial risks associated with owning a marijuana company are made particularly obvious by so much cash being present. Cannabis product liability and insuring against theft is essential considering how often these marijuana delivery robberies are occurring. Reach out to S2S Insurance Specialists, Eric Rahn and David Rahn with any questions.

Read more at Kron4.com

Understanding Why Cannabis Insurance Is Hard To Come By

Finding dispensary insurance, cannabis product liability coverage, marijuana crop insurance and other forms of coverage for cannabis is challenging due to the Schedule I status of marijuana on the federal level. Finding cannabis insurance specialists is also challenging because the industry is so new and insurance professionals are all still learning. That does not mean though that some insurance agents have not spent more time understanding the unique financial risks associated with being a part of the cannabis industry than others.

Insurance for marijuana dispensaries and processors can be difficult to find.

The banking restrictions may be one of the largest hurdles preventing larger insurance carriers from offering marijuana related insurance policies. The banking system is essential for most insurance companies and the fear of being accused of infractions such as money laundering by working with companies that touch the cannabis plant stops the large players from taking the risk.

“The whole conversation of cannabis crosses the desks of the most senior leaders of the insurance community as they determine whether or not they want to play in this game,” said Tom Fitzgerald, global broking officer at insurance broker Aon Plc. “There’s not every insurance company in the world anxious to write this stuff, at least not yet.”

“Just a few handful of carriers” will write policies for cannabis-related firms, said James Nelson, a retail insurance broker and owner of New Growth Insurance in Alameda, California.

Hartford, based in the Connecticut city of the same name, said it’s abstaining from the industry, and “that is unlikely to change” while the federal ban is in place.

“We do not underwrite any business that sells, grows, transports or distributes marijuana or products derived from marijuana cannabinoids,” the company said in an emailed statement.

There are all sorts for cannabis coverage alternatives for dispensaries, medical marijuana doctors, cannabis product liability insurance and much more. It has not been very easy for companies working with marijuana to find answers on how to cover their financial risks.

While other insurance companies may be too nervous to offer coverage to marijuana companies, S2S Insurance Specialists has embraced the burgeoning cannabis industry. Get in touch with Eric Rahn or David Rahn to discover the best marijuana insurance alternatives available to your company.

Read more at Bloomberg.com

California Marijuana Insurance Big Topic at Wholesaler Association Conference

If California marijuana insurance is a major topic at a wholesaler conference then you know that it is important. California saw over $9 billion in general insured losses last year over the two November wildfires alone. Also, a massive court decision known to as the Dynamex decision is shaking the industry.

The California Wholesaler Association conference is a major conference for insurance agents in the 5th largest economy in the world. California is lacking in cannabis insurance specialists but the industry is ramping up quickly after recreational marijuana became a legal regulated market in 2018. A little over a year later, California is still working out many details and has a long way to go, but the California marijuana insurance business is likely to become much larger.

cannabis insurance specialists are more important since so few people involved in the business of marijuana understand their alternatives

A number of marijuana insurance agents were present to speak and learn at the conference and spoke with an Insurance Journal reporter. The CEO of one particular insurance company had this to say:

He said most cannabis operators seek the same kind of insurance many businesses want, such as general liability, workers’ compensation, slip and fall.

He said growing facilities with their expensive equipment and sophisticated operations need a lot of insurance.

“We’re seeing high property limits,” he said.

Brown said some businesses have been in operation long enough to have a good loss history, but many operated in grey areas before California legalized adult use, so that history isn’t always a dependable one for underwriting purposes.

Underwriting as a whole for the cannabis industry can be tough, he said, because there are also numerous companies with no loss history at all.

“The business interruption exposure, for example, is a vague and nebulous thing for a lot of startup operators,” he said.

Tatum said that because banks are regulated by the federal government, which still considers cannabis a controlled substance, that many operations have an abundance of cash on hand.

“Finding coverage for the actual cash on the premises has been a problem,” he said.

Quilici said that educating her clients on the ins and outs of cannabis coverage has become a big part of the job, as has educating herself.

“I’ve got retailers that know this business than I ever could, and I’ve got retailers that know nothing,” she said.

California marijuana farms have been around illegally since the 1960's but now that cannabis is legal marijuana crop insurance is important

Cannabis coverage is essential and it is not surprising that marijuana business owners are looking for the same sort of Directors and Officers insurance, slip and fall insurance and other logical forms of coverage as mainstream industries. California has been the home of illegal marijuana grows since the 1960’s and the idea of getting any sort of marijuana insurance coverage probably never really occurred to growers.

The marijuana industry is growing rapidly and so proper cannabis insurance coverage will be as normal for cannabis companies as any other industry. Cannabis crop insurance is certainly important with the wildfires in that region of the country. Beyond that, normal dispensary insurance, marijuana lab testing insurance and other forms of coverage become that much more important the bigger the California marijuana industry grows.

Read more at InsuranceJournal.com

SAFE Banking Act of 2019 Would Protect Banks Working with Cannabis Companies

The amount of liability in the marijuana industry is staggering. Possibly the greatest financial risk of owning a cannabis dispensary, or any business that handles the marijuana plant on a regular basis, is that most cannabis based companies are left with no choice but to work on a cash-only basis leaving them vulnerable to robbery. The House Financial Services subcommittee met recently to discuss the challenges banks are facing by working with cannabis companies and potential solutions. The meeting included discussing the newly introduced SAFE Banking Act of 2019, also known as the Secure And Fair Enforcement Banking Act of 2019.

safe banking act of 2019 and cannabis insurance specialists

While some robberies at cannabis companies involve violence, including one incident in Colorado that left a security guard dead, the greatest threat of robbery may be internal from trusted employees. The temptation when cash money is laying around is often too much to overcome. Dispensary insurance is of the utmost importance with the current banking challenges that cannabis companies must contend with. Cannabis insurance specialists are difficult to come by since most insurance companies steer clear of any business that is associated with a Schedule I controlled substances.

While the House of Representatives may vote on and pass the SAFE Banking Act of 2019 during the current legislative session, the bill will face a much greater challenge passing in the Senate. Senate Majority Leader Mitch McConnell does not support the legalization of marijuana, or anything that furthers marijuana reform, even though he does support the legalization of hemp. Regardless of what happens, S2S Insurance Specialists are here for any cannabis company’s insurance needs as we have attained a clear understanding of the financial risks associated with the cannabis space.

“The conditions are as good as they’ve ever been for legislation to proceed,” said Ryan Donovan, chief advocacy officer for the Credit Union National Association, a trade group that lobbies for credit unions. “75% may be a little high, but [the odds] are better than they were in the last Congress.”

“This hearing is part of an effort to try to generate some momentum in the House of Representatives,” Donovan said. Prospects for cannabis-banking legislation “might be easier to see once we get past the shutdown threat and get into more of a normal legislative environment,” he added.

“The safety of thousands of employees, business owners, security personnel, police officers and community members is in your hands,” Neill Franklin, the Law Enforcement Action Partnership’s executive director, told the subcommittee on consumer protection and financial institutions. LEAP is a nonprofit known for opposing the “war on drugs.”

The ranking member of the House Financial Services subcommittee, Missouri Rep. Blaine Luetkemeyer, argued against the SAFE Banking Act of 2019 and his thoughts were echoed by the chairman of Smart Approaches to Marijuana, Jonathan Talcott.

missouri rep. blaine luetkemeyer discusses safe banking act of 2019
Missouri Rep. Blaine Luetkemeyer

“You really need to address the Controlled Substances Act and its prohibition on marijuana … before any of the proposed changes and safe harbors would be effective,” Talcott said in his testimony. Luetkemeyer made a similar point, saying lawmakers were “dealing with an illegal industry at the federal level” and “putting the cart before the horse” by focusing on the industry’s banking needs.

Until marijuana is rescheduled on the Controlled Substance Act, or completely descheduled, cannabis companies must make sure that their financial risks are covered and marijuana insurance policies are the smartest alternative. We offer CBD product liability insurance, cannabis crop insurance, D&O insurance and cannabis dispensary insurance. Contact Eric Rahn or David Rahn, your cannabis insurance specialists.

read more at marketwatch.com

Cannabis Insurance Top 5 Mistakes | S2S Insurance

No matter what line of business you are in, you need some form of insurance, that includes cannabis companies. Choosing the right cannabis insurance provider and policy can be a daunting task and mistakes can definitely be made.

Below, Eric Rahn, insurance specialist at S2S Insurance, breaks down common mistakes cannabis related business owners make when choosing an insurance policy and how to avoid them.

1. They don’t purchase insurance at all.

s2s insurance, eric rahn, marijuana insurance, weed, dispensary insurance, cannabis insurance specialistsOne of the biggest mistakes cannabis business owners are making is not having a policy at all. While the wrong policy is problematic, not having any coverage can be devastating to a new or even an established business. Investing in insurance covers the unforeseen and mitigates risk. Whether a cannabis business is faced with vandalism, theft, product liability, employee law suits, management issues, the right policy can save tens of thousands of dollars or even hundreds of thousands of valuable dollars.

2. They don’t purchase cannabis specific insurance.

Cannabis insurance is becoming a very specialized niche in the insurance industry. Not all insurance agents/brokers have the knowledge about the risks in the cannabis industry. Insuring cannabis is not like insuring your house or automobile strictly because of the nature of what you’re trying to insure and how it’s viewed by the government. If you don’t have a policy that is specific to cannabis there may be certain exclusions based on the Schedule I status of cannabis or illegal substances. Those types of exclusions and exceptions can derail a cannabis business owner’s ability to collect on a policy.

3.  They don’t work closely enough with a cannabis insurance specialists

Working closely with someone that knows the cannabis insurance industry is critical when choosing a policy. Cannabis business owners have to ask their agents/brokers questions, lots of questions and the broker/agent needs to be able to answer those questions. Your agent should be asking you questions as well. Risk grows with your business, is your insurance growing with your business? What’s your tolerance for risk? How much can you afford to lose? Are you currently covered to avoid the catastrophic losses that can shut your doors? Those are some of the blunt but required questions cannabis business owners should be discussing and answering with a cannabis insurance specialist.

4. Cultivators fail to buy crop insurance

If you are a cultivator or a grower, you rely on your cannabis crop for your income. Cannabis is agriculture, just like corn, wheat, or soy. Cultivators have to protect their income, therefore they must have cannabis insurance specifically crop insurance. Every year out west in California and Arizona there are wildfires that destroy thousands of acres of land and crops. While we don’t know where and when these disasters are going to strike, history tells us there is a good chance they are going to happen. Cannabis cultivators must be prepared for this unfortunate reality.

s2s insurance, eric rahn, cannabis insurance, liability insurance for marijuana, cannabis recommendations5. Cannabis business owners don’t know whats in their policy

As a cannabis business owner knowledge is power. You have to be aware of the changing laws at the federal, state, and local level. You also need to know your business inside and out. Part of knowing your business is understanding what is and is not in your insurance policy. You have to know what is covered and what is excluded which could include cannabis specific exclusions even within a cannabis insurance policy. If you have cannabis insurance with cannabis exclusions, it may be time to look at another cannabis insurance provider. At S2S Insurance we pride ourselves on our experience and expertise and would be happy to review your policy and your risk exposure to help put your mind at ease.