Cannabis and the Role of Insurance

What role will insurers' play? We ask CLM members and fellows to chime in.

December 08, 2019 Photo

With the rapid growth of the cannabis industry, how has the insurance industry gotten involved and do you see its role expanding in the near future?

“While the insurance industry is involved in the cannabis space through creative packages, the full potential for insurance in this market has yet to be reached, as cannabis is still a Schedule I drug. The House passed the SAFE Banking Act, which would allow financial institutions operating in states where cannabis is legal to continue to operate, legally. The bill was sent to the Senate, where it has not been addressed.”

Dawn Dezii, Partner, Margolis Edelstein. CLM Member since 2012.

“Marijuana is still considered largely off limits, but a few excess and surplus carriers provide coverage. Insurers’ roles will expand with growers’ and dispensaries’ need for D&O, liability, and workers compensation coverage. Property coverage is becoming a hard market for everyone right now, even in the cannabis industry.”

Chantal M. Roberts, President, CMR Consulting. CLM Fellow since 2019.

“The insurance industry is starting to keep pace with the ever-evolving cannabis industry by offering policies ranging from cultivation to dispensaries. However, our clients have few choices for insurance depending on the risks presented. Given the incredible demand and growth in the industry, I expect we will see an appreciation that these risks can be effectively underwritten, and are a huge business opportunity.”

Rebecca M. Gabroy, Senior Associate, Wood, Smith, Henning & Berman LLP. CLM Member since 2017.

“Growth of the cannabis insurance industry has been mixed. Currently, there are good insurance options for property, CGL, products, and workers compensation. Specialty lines are lagging due to difficulty with underwriting and pricing. Adequate limits remain a problem for all lines. Further growth of the cannabis insurance industry would be facilitated by legislation similar to the SAFE Banking Act.”

Ian Stewart,
Partner, Wilson Elser Moskowitz Edelman & Dicker LLP. CLM Member since 2009.


Number of states (including the District of Columbia) that have legalized recreational use of marijuana.

Source: DISA Global Solutions


The median salary for cannabis industry job openings, which is 10.7 percent higher than the U.S. median salary.

Source: Glassdoor

$10.4 Billion

Size of the legal marijuana industry in the U.S. in 2018.

Source: New Frontier Data


About The Authors
Phil Gusman

Phil Gusman is CLM's director of content.

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