Cannabis and Insurance

46 Pages Posted: 1 Jul 2019 Last revised: 15 Aug 2019

See all articles by Francis Joseph Mootz III

Francis Joseph Mootz III

University of the Pacific - McGeorge School of Law

Jason Horst

Horst Legal Counsel

Date Written: June 30, 2019


Although many states have decriminalized or legalized cannabis, it remains a Schedule 1 drug under the federal Controlled Substances Act. The conflict between federal and state law presents many complicated issues, including significant problems relating to insurance coverage. Insurance law seeks to balance competing policy interests. On one hand, public policy supports reading insurance policies broadly to indemnify policyholders for their losses. On the other hand, public policy counsels against permitting insurance to indemnify (federally) illegal activity. In this Article, we explore some of the pressing problems arising out of the conflict between these policy considerations in the context of liability, property, and employment-related insurance. We also explore emerging cannabis insurance policy options in states where cannabis is legal and discuss the advantages, but ultimate inadequacy, of those options. We conclude that policyholders are likely to find that their reasonable expectations of insurance coverage are unmet at this point in the emerging market.

Keywords: cannabis, insurance, public policy

Suggested Citation

Mootz, Francis Joseph and Horst, Jason, Cannabis and Insurance (June 30, 2019). Lewis & Clark Law Review, Vol. 23, No. 3, 2019, Available at SSRN: or

Francis Joseph Mootz (Contact Author)

University of the Pacific - McGeorge School of Law ( email )

3200 Fifth Avenue
Sacramento, CA 95817
United States

Jason Horst

Horst Legal Counsel ( email )

199 Fremont Street
20th Floor
San Francisco, CA 94105
United States

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