If the Federal Government Ever Gets Around to Legalizing Cannabis, Here Are the Insurance Implications

In his 2015 stand-up special The Comeback Kid, stand-up comedian John Mulaney joked that the government had ‘[become] like cool parents’ when it came to marijuana.

It’s a claim many an onlooker would agree with. Nearly every year since 2012, when Washington and Colorado legalized recreational marijuana use through ballot measures, more and more states have passed laws allowing for medical and/or recreational usage.

Last year, five states passed laws legalizing either recreational cannabis, medical marijuana or both through ballot initiatives, causing some to dub the 2020 election a ‘Green Wave,’ and New York’s recent law legalizing recreational marijuana caused Vox to declare weed ‘has won.’

Even as states legalize the drug in droves, marijuana remains illegal at the federal level and is still classified as a Schedule 1 drug by the U.S. Drug Enforcement Agency.

This quasi-legal status makes it difficult for recreational cannabis companies to obtain everything from bank loans to the insurance needed to run their businesses due to differing federal and state regulations.