Insurance gaps challenge cannabis industry: NAIC white paper
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NEW YORK — The insurance market for the cannabis industry remains substantially challenged as the industry grows, according to a white paper from the Cannabis Insurance Working Group of the National Association of Insurance Commissioners.
The working group was formed in August 2018 to identify insurance issues, gaps and opportunities facing the cannabis industry and to identify best regulatory practices to address these issues, the paper says.
A synopsis of the paper was presented at the summer meeting of the National Association of Insurance Commissioners on Monday in New York.
White paper findings show there are substantial gaps in insurance coverage for the industry, including the commercial auto and workers compensation lines.
The paper also addressed regulatory activities.
California was the first state to approve admitted insurance carriers for the cannabis industry, the paper notes, launching the Cannabis Insurance Initiative in 2017.
“Through education and outreach the California Department of Insurance (CDI) laid the groundwork for cannabis insurance on the admitted market,” the paper said, and “as of the publication of this white paper, the CDI had approved six carriers.”
Recent federal legislation such as the SAFE act may also help improve the operating environment for the cannabis industry
The SAFE Banking Act of 2019, or H.R. 1595, was proposed “To create protections for depository institutions that provide financial services to cannabis-related legitimate businesses and service providers for such businesses, and for other purposes,” according to the legislation.
Sen. Cory Booker, D-N.J., sponsored the Marijuana Justice Act of 2019, S. 597, a bill introduced to amend the Controlled Substances Act to “provide for a new rule regarding the application of the Act to marihuana, and for other purposes.”
More recently the House introduced a complementary bill.
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