Landlords who rent property to the cannabis industry can now be insured for any liability. California’s state insurance commissioner, Dave Jones, announced the state office has approved California Mutual Insurance of Hollister to write Lessor’s Risk coverage for property owners who are exposed to specific risks resulting from cannabis related business activities of their commercial tenants.
Specific commercial activities and businesses addressed by this coverage include cannabis labs, product manufacturing, cultivation, and dispensary operations.
“I want to make sure that when consumers shop in cannabis businesses, when investors and owners invest in cannabis businesses, when vendors sell to cannabis businesses, and when landlords rent to cannabis businesses, there is insurance coverage available to cover everyone from losses. I encourage more insurance companies to follow California Mutual Insurance Company’s lead and file insurance programs to fill the gaps in coverage for the cannabis industry,” Jones stated in making the announcement.
Jones says he recently renewed his call for insurers to offer insurance products for California’s legalized cannabis industry in the wake of published reports that President Trump has abandoned Attorney General Jeff Sessions’ policy on federal law enforcement of cannabis.
Jones also sent a letter to California insurers encouraging them to fill insurance gaps for California’s cannabis businesses.
In a recent North Bay Business Journal column Shanti Eagle, a senior associate and Jacqueline Menendez,s a law clerk at the San Francisco law firm of Farella Braun + Martel’s wrote:
“Many insurers are wary to insure what is still an emerging and unknown risk, preferring to gather more information and determine the loss ratio trends before offering insurance products to the cannabis industry. Others carriers shy away because of their conservative profile, the perceived stigma, and the continued federal illegality.”