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.
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.