Cannabis risk retention group launches
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A Nevada-domiciled risk retention group aimed at the cannabis sector launched Thursday.
CLIC Risk Retention Group will offer general liability and product liability coverage to cannabis firms in states where cannabis is legal for medical or recreational use, said Chris Payne, CEO of CLIC Management LLC in La Jolla, California.
The management company was established in 2018 with the intention of forming a cannabis RRG, said Mr. Payne, a consultant who has a background in health care captives.
The RRG, which was established to create more capacity for the cannabis sector, has received a certificate of authority and is recruiting members, he said.
Many traditional insurers have been reluctant to offer coverage for cannabis companies because the drug is illegal at the federal level, although 33 states have legalized cannabis for medical use and 11 of those states also allow recreational use.
“Premiums are extremely high; very few insurers offer coverage,” Mr. Payne said. “Companies in the industry have built valuable cannabis brands and need a reliable insurance partner that will help defend that investment.”
