The high times, they are a-changin’. Or perhaps not.
In 2014, then-President Obama quietly “ended the war on marijuana” by instructing federal officials to stand down from raiding cannabis operations in those states that had voted for legalization. In December 2015, he also signed a budget bill that included language that all but legalized medical marijuana on the federal level, specifically prohibiting the banning of federal funds being used by veterans for medical marijuana treatment in state-approved programs.
That all may be changing. It has recently been reported that Attorney General Jeff Sessions plans to reverse the previous directive, granting the federal government the right to reignite the war on cannabis.
Will this have an effect on your business and the cannabis insurance industry? Probably not. Here’s why.
States Aren’t Going To Take It
In those states where marijuana has been legalized, the industry is big business, creating significant income for business owners and tax coffers. Those states won’t take federal interference lightly.
In fact, California Attorney General Xavier Beccera has vowed to “vigorously enforce our state’s laws and protect our state’s interests.” Colorado Attorney General Cynthia Coffman (now a candidate for governor) made similar statements.
Also of note: 12-year-old Alexis Bortell is taking on Mr. Sessions. The preteen will have her day in court February 14, suing the federal government for her right to continue to access cannabis treatment for a seizure disorder.
It was widely reported after the Sessions memo came to light that cannabis industry investors were running scared. Forbes said just the opposite, quoting investors who noted that the directive didn’t really change anything for the industry in those states where cannabis is legal.
Stocks in US businesses did initially tumble upon news of the federal directive, but Canadian stocks encountered a boom. US stocks now appear to be on the rebound, as states vow to fight for their rights to legalize and benefit from cannabis.
Insurance Is Still Available
Though Lloyds of London left the cannabis industry two years ago, there are still insurance carriers available to business owners in every facet of cannabis operations. In fact, Golden Bear Insurance recently started writing cannabis businesses on an admitted basis in California.
As of today, there are no current insurance carriers who plan to cease writing cannabis insurance based on the federal memo. The insurance industry will continue business as usual unless and until it becomes unprofitable to do so.
If you are concerned about insurance for your cannabis business, contact Hayes Insurance. We wrote the book on cannabis coverage, and we have access to the insurance carriers and policies that you need to cover any facet of cannabis operations.