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Insurance For Medical Marijuana Industry?

The General

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A local insurance broker sees a business opportunity in protecting the assets of medical marijuana growers and dispensaries in California and elsewhere. Sacramento-based MMD Insurance Services – the MMD stands for Medical Marijuana Dispensary, claims to be the first general insurance agency to offer comprehensive insurance for the medical marijuana industry in states that allow the business.

With an eye toward business in Colorado and Washington, MMD rolled out new coverage last month that seeks to ensure that growers and dispensaries that sell their product are compensated for losses by natural disaster -- or federal raid. The product does so by taking the exclusion for marijuana and its derivatives out of the insurance contract. "The question is can a carrier deny a claim based on cannabis as one of the losses," said Mike Aberle, a Sacramento insurance broker who is national director for MMD Insurance Services. "We'll include cannabis and other assets."

California remains a gray area due to the industry boom after California voters approved use of medical marijuana with a doctor's prescription – and bust when federal authorities launched a crackdown against dispensaries. How many California dispensaries buy insurance is unclear – and there aren't many of them around anymore. More than 100 marijuana dispensaries in the city and county of Sacramento closed after the federal crackdown began in 2011. One of reasons was pressure on property owners to kick out what the feds consider an illegal business. "Could a carrier claim federal law over state law?" Aberle asks. "Perhaps, but by removing this exclusion, in writing, manufacturers and producers have at least one more legal leg to stand on."

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News Moderator - The General @ 420 MAGAZINE ®
Source: Bizjournals.com
Author: Kathy Robertson
Contact: Contact Us - Sacramento Business Journal
Website: Insurance agency offers coverage for medical marijuana dispensaries - Sacramento Business Journal
 
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