The National Association of Insurance Commissioners has named California Insurance Commissioner Dave Jones chair of its new Cannabis Insurance Working Group.
Jones proposed that the NAIC establish this working group the NAIC’s Summer National Meeting.
The reason for creating the group would be to enable state insurance regulators to better understand where there are insurance coverage gaps for the legalized cannabis industry and to share and develop best practices for state insurance regulators to follow to address coverage gaps and cannabis insurance regulatory issues.
Jones previously chaired the NAIC’s Sharing Economy Working Group, which developed a template for insurance coverage for ridesharing and home sharing.
“Cannabis businesses face insurance availability and insurance coverage gaps – which means that those who shop, those who work in, those who sell goods or services to, or those who own, invest in or operate cannabis businesses may not have access to insurance to help them recover if there are accidents, injuries, property damage, or any of the things insurance typically covers,” Jones said in a statement. “As state insurance regulators, one of our responsibilities is to understand new legal businesses and their insurance needs, and then work to encourage the availability of insurance to meet these new risks and coverage needs.”
The NAIC Cannabis Insurance Working Group will consider the insurance regulatory issues surrounding the legalized cannabis business from seed to sale, including availability and scope of coverage, workers’ compensation issues, and consumer information and protection. The working group will also develop a white paper outlining the issues and make recommendations for the development of regulatory guidance as appropriate.
Jones launched an initiative last year in California to encourage admitted commercial insurance companies to write insurance to fill coverage gaps for the cannabis industry.
The first filing and approval of an admitted commercial insurer offering insurance for the cannabis industry was announced in November 2017, the first surety bond program for the industry was announced in February 2018, the first coverage for commercial landlords for the industry was announced in May 2018, the first standardized cannabis policy forms and program filed by the American Association of Insurance Services was approved in June 2018, and last week three more insurance carriers were approved by Jones to offer surety bond coverage for the cannabis industry in California.
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