Despite budding cannabis market, insurance still lags behind

Like any other industry, cannabis has many risks that require comprehensive insurance coverage. For example, because licensed cannabis businesses are required to collect customer information, they are particularly vulnerable to cyberattacks. (Photo: Diego M. Radzinschi/ALM)

Editor’s Note: Some industry experts disagree with the findings in the New Dawn Risk report. Please draw your own conclusions.

Support for cannabis legalization in the United States has steadily risen since 1989, and many states have altered their stance on the matter in recent years. Although 32 states have legalized cannabis for medical or recreational use, it remains illegal on a federal level — which has complicated matters for many looking to get involved or support cannabis businesses, especially for those in the property & casualty insurance industry.

Despite the state of limbo surrounding cannabis, it continues to grow. The U.S. legal marijuana market expanded from zero to over $10.4 billion in 2018, with 250,000 jobs devoted to the handling of plants, according to the Associated Press. And this does not take account of the companies that retail the products or supply services such as packaging, processing, payroll and transport, according to a new report by New Dawn Risk. The report examines how big the cannabis market could get, laws and rulings that impact cannabis coverage, the challenges for carriers and brokers, and more.