Cannabis businesses had to adapt their operations during the COVID-19 pandemic, which led to increased risks, including changed workers compensation exposures, a panel of experts said.

Medical cannabis was deemed an essential enterprise in most states where it is legal and allowed to remain open, but other businesses were forced to close, forcing dispensaries and their suppliers to adapt.

Garrett Graff, managing partner at Hoban Law Group in Denver said the distinction between medical and recreational marijuana influenced states’ responses. Massachusetts, for example, deemed medical cannabis essential but not recreational cannabis.

He was speaking Thursday during the fourth in a series of webinars on the cannabis sector sponsored by Business Insurance.

States responded to the close quarters at many dispensaries, Mr. Graff said. Some states issued emergency orders allowing curbside delivery and pick up where none had been allowed previously. Others such as Colorado maintained a strict “brick and mortar” regime to help ensure proof of age and identity and overall security, he said.

Suppliers faced challenges as a “rush on dispensaries” led numerous customers to order restock, said Eduardo Provencio, senior vice president, legal for BellRock Brands Inc., a Denver-based cannabis products company. Selling and delivering cannabis products was difficult amidst the restriction imposed by COVID, he said.

The expansion into delivery caused by the pandemic restrictions carried with it pros and cons, speakers said.

Jeremy Siegel, vice president for compliance and legal risk for Eaze Technologies Inc., a San Francisco-based cannabis marketplace and delivery company, said some states, such as Massachusetts and Colorado, had an independent license regime for delivery, which helped smaller businesses operate in the sector.

Mr. Siegel said delivery expanded amidst the pandemic lockdowns. “As folks couldn’t go into the dispensaries, they definitely turned to delivery,” he said.

The downside was increased risk, said Jim McErlean director of business development at Cannasure Insurance Services LLC. in Redondo Beach, California.

Curbside delivery and drop-off expose employees to increased workers comp and theft exposures, Mr. McErlean said.

The added cost to insure the potential new exposures can be “pricey” in what Mr. McErlean called a hard market.

Recordings of BI’s cannabis webinar series are available here.