House Reps. Nydia Velázquez & Warren Davidson Introduce Bill To Help Cannabis Companies Obtain Insurance

On Thursday, Rep. Nydia M. Velázquez (D-NY) and Rep. Warren Davidson (R-OH) introduced the Clarifying Law Around Insurance Marijuana, or CLAIM Act, which would prevent federal criminal prosecution of insurers and end civil liability for brokers, agents, and insurers that deal with companies in the cannabis sector.

Filed one day after bipartisan lawmakers took another stab at the SAFE Banking Act, which sent weed stock into a tizzy, the CLAIM Act seeks to protect insurers, brokers and agents from being penalized by federal regulators for providing insurance services to state-legal weed companies. 

"Insurance companies are oftentimes reluctant to provide coverage to cannabis-based businesses, due to discrepancies between federal and state laws,” said Congresswoman Velázquez in a press release. “These promising new businesses have no safety net in place and are left extremely vulnerable to natural disasters or fires that may destroy all they've worked to build. This bill will help entrepreneurs operating in the legal cannabis sector access to the insurance they need to protect their business.”

Congressman Warren Davidson added that insurance companies should be allowed to participate in the marketplace to function properly and play a critical role in the development of small businesses. 

“The CLAIM Act takes needed corrective action by granting the ability to insure risk without having otherwise lawful markets blocked by regulators.”

The bill also requires the Government Accountability Office to conduct a study of the hurdles facing both women and minority entrepreneurs considering a career within the cannabis sector, in order to address the historical legacy of targeting minorities through marijuana-related charges.

Photo: US House of Representatives