Grower Anthony Nguyen sells marijuana at the medical marijuana farmers market at the California Heritage Market in Los Angeles./ REUTERS
Marijuana is on the verge of becoming a big business for insurers.
As more states legalize it for medical and recreational uses, there is a growing need for insurance coverage that will protect marijuana-related businesses from the time seeds are first planted, to the quality-control labs that test the plants, down the distribution channels to when they are sold in medical or recreationally oriented dispensaries.
But there is one major roadblock to its distribution by the admitted market: It is still listed by the federal government as an illegal drug.
While a growing number of excess and surplus lines insurers are beginning to offer coverage, there is general agreement it will not be widely written by the admitted market until — or if — the federal government changes its policy.
Some observers point to its decriminalization by 29 states and the District of Columbia, including the potentially massive California market that opens up in January. They say this trend’s sheer