U.S. Reps. Nydia Velázquez (D-NY) and Steve Stivers (R-OH) introduced legislation to better protect companies that serve the cannabis industry.

© Shutterstock

The Clarifying Law Around Insurance Marijuana, or CLAIM Act, H.R. 2068, would prevent federal criminal prosecution of insurers and end civil liability for brokers, agents, and insurers that deal with companies in the cannabis industry. This would allow entrepreneurs within the cannabis sector to access the insurance they need for their businesses in states where it is legalized.

“Insurers are reasonably reluctant to offer coverage to cannabis-based businesses, given the current discrepancies between federal and state law,” Velázquez said. “All the same, these promising new businesses are left extremely vulnerable to any flood or fire that may come along and destroy all they’ve worked to build with no safety net in place. This bill will establish a safe harbor for insurers working with these businesses, allowing them to legally operate in states that legalized marijuana without fear of repercussion.”

The bill would also require the Government Accountability Office to study the hurdles facing both women and minority entrepreneurs considering a career within the cannabis sector.

“We have to legislate for the reality we live in, and that reality is that there are legal Ohio businesses in the cannabis industry that are facing huge risks but can’t access insurance as a result of a patchwork of state and federal laws,” Stivers said. “The CLAIM Act would ensure that legal cannabis businesses can get the financial products, like insurance, that they need to operate.”

A companion bill was introduced in the Senate by Sen. Bob Menendez (D-NJ) and cosponsored by Sens. Rand Paul (R-KY) and Jeff Merkley (D-OR).