The cannabis industry is one of the fastest-growing industries in the U.S., maturing at more than 25% annually. As the cannabis industry continues to emerge and flourish from state to state, there remains uncertainty as to the immediate future of federal legislation to remove cannabis from the schedule of controlled substances.

The cannabis industry will continue to experience the convergence between state and federal government regulations until a uniform regulatory and compliance framework can be established. Fundamental services such as banking, financing, and insurance, along with IRS 280E tax regulations, will continue to burden state-regulated cannabis businesses. And, with the industry still in its relative infancy, emerging and shifting regulatory backdrops create risks to these businesses. 

Cannabis businesses can manage these risks in a variety of ways. Perhaps the foremost among them are the procurement of appropriate insurance coverage. While just a few years ago, insurance coverage options for cannabis operators were incredibly limited, today there are dozens of insurance carriers serving the industry .

Cannabis operators have to be proactive in developing a risk management program that conforms to local and state compliance and security requirements. As the industry continues to evolve, we will need to be more diligent in controlling and managing risk.

To assist with this process, NCIA’s Risk Management & Insurance Committee (RMIC) is pleased to provide the first in a series of Insurance Manuals that will help guide you through the various coverages and definitions used in the cannabis insurance industry. This first edition of the RMIC Insurance Manual will outline the basic and entry level knowledge base for the cannabis insurance industry, and explore the various insurable risks attributed to the cannabis supply chain. Future additions will dive deeper into more specific insurance topics.

NCIA’s Risk Management & Insurance Committee is a multidisciplinary group of risk management professionals convened to draw on expertise and experiences of professionals dedicated to the cannabis community. Primary contributors for the first installment of the Insurance Manual include:

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Eric Rahn, S2s Insurance Specialist

Shay Gilmore, Shay Gilmore Law

Adam Patt, iCann Insure, LLC               

Mathew Grimes, Grimes Law Group LLC 

Sandra Sheils, Safety Equation

Jason Horst, Horst Legal Counsel 

Summer Jenkins, Cannasure Insurance 

Doug Esposito, Owen Dunn 

Christopher Payne, CLIC Risk Retention Group, Inc 

Cimone Casson, Cimone Casson, LLC 

Jim Gerencser, Nationwide Auto Services 

Merril Gilbert, TraceTrust