How the CLAIM Act Will Affect Insurers
Insurers providing coverage to marijuana-touching businesses could find safe harbor under the CLAIM Act.
By the end of 2019, the cannabis industry* is expected to employ more than 200,000 people and could be worth as much as $48 billion in the United States. By almost any means of measuring growth, the industry will expand by more than 30% in 2019 alone. However, despite the headlines proclaiming cannabis “legal” in a growing number of states, cannabis, in fact, remains illegal at the federal level — it is categorized as a Schedule I drug by the U.S. government, meaning a drug “with no currently accepted medical use and a high potential for abuse.”
In 2013, the Obama administration declared a (mostly) hands-off approach for the enforcement of cannabis-related offenses. The Cole Memorandum, issued by the Department of Justice, declared that it would not prioritize the enforcement of federal anti-cannabis laws in states that had “legalized marijuana in some form and…implemented strong and effective regulatory and enforcement systems to control the cultivation, distribution, sale, and possession of marijuana.” However, this memorandum was reversed by the Trump administration under former Attorney General Jeff Sessions. Though current Attorney General William Barr has stated he “would not go after” marijuana companies, the DOJ has not issued a formal statement confirming this.
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