California has taken the next step in boosting its cannabis business. For the first time, California marijuana companies are now able to buy commercial insurance from a state-guaranteed insurer.
Insurance Commissioner Dave Jones approved Golden Bear Insurance to be the first admitted (state-backed) commercial insurance company to cover legal marijuana businesses in California.
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In a statement, Jones said:
This is the first of what I hope will be many commercial carriers filing insurance products to fill insurance coverage gaps for the cannabis industry. Consumers who visit cannabis businesses, workers who work there, businesses who sell products to or rent property to cannabis businesses, and the investors, owners and operators of cannabis businesses all should have insurance coverage available to help them recover when something goes wrong just as any other legalized business does.
Last month, cannabis businesses and insurance company reps testified at a public hearing, revealing a coverage gap for the marijuana industry — specifically that commercial carriers were not providing insurance.
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“Our mission,” said Jones, “remains insurance protection for all Californians, which includes insurance for California’s legalized cannabis businesses and customers. We encourage more insurance companies to file cannabis business insurance products with the department to meet the needs of this emerging market.”
Galen Hayes of Hayes Insurance Agency, the exclusive broker for Golden Bear, tells Business Insurance that Golden Bear will initially write general liability coverage, including professional and products liability; and property coverage, including coverage for buildings, contents and tenant improvements. Coverage will be available for both landlords and tenants.
Recreational marijuana becomes legal in California on Jan. 1, 2018.