Insurers Push Congress to Reopen Cannabis Coverage Access

September 26, 2026

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Two lawmakers who don't agree on much else just put their names on the same bill again. Rep. Nydia Velázquez, a Democrat from Brooklyn, and Rep. Warren Davidson, a Republican from Ohio's Miami Valley, reintroduced the CLAIM Act on September 16, 2026. A Senate companion, filed back in July by Kevin Cramer of North Dakota and Ruben Gallego of Arizona, is already sitting in committee waiting for a partner in the House to catch up. That partner has now arrived.

What makes this reintroduction different from the last several is who showed up to cheer it on. On September 8, nine major insurance trade associations — collectively representing a majority of the U.S. property-casualty, life, title and reinsurance market — sent Congress a letter publicly endorsing the bill. That's not a niche cannabis-industry ask anymore. That's State Farm's trade group, life insurers' trade group, and title insurers' trade group all saying the current setup doesn't work for them either.

None of this is new territory for Velázquez. She introduced nearly identical language back in 2019, when the cannabis banking conversation was still dominated almost entirely by SAFE Banking. Seven years later, SAFE Banking still hasn't crossed the finish line, and now the insurance industry appears to be running its own version of that same marathon — timed, notably, to arrive just as federal marijuana rescheduling is moving through its own separate process.

What the CLAIM Act Actually Does

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The CLAIM Act — short for Clarifying Law Around Insurance of Marijuana — is a narrower cousin of SAFE Banking, built specifically for the insurance side of the ledger rather than deposits and loans. Its core function is straightforward: it shields insurers from federal criminal penalties for underwriting policies for cannabis businesses that are operating legally under their state's law. Right now, an insurer writing a general liability policy for a licensed dispensary is technically facilitating a federally illegal enterprise, since marijuana remains a Schedule I substance under the Controlled Substances Act regardless of what a state's ballot measure or legislature says.

The bill extends that same liability shield to the people actually selling the policies — insurance agents and brokers — who currently carry personal and professional exposure for placing cannabis-related coverage. It also blocks federal agencies from canceling, non-renewing or otherwise restricting an insurer's policies purely because that insurer has cannabis clients on its book. That's a real problem today: a federal regulator with concerns about a bank's cannabis exposure has tools to lean on that institution, and insurers argue they face the same kind of informal pressure.

That leads to the bill's fourth major piece — a prohibition on federal regulators pressuring, encouraging or coordinating with insurers to drop cannabis-related clients, a practice reminiscent of the Operation Choke Point-style tactics banks dealt with in other contexts. Finally, the bill isn't purely a liability shield. It directs the Comptroller General and the Government Accountability Office to study the barriers women and minority entrepreneurs face in getting licensed and accessing financial services in the cannabis industry, with findings reported back to Congress — an equity provision that gives the bill a policy rationale beyond simply protecting insurance company balance sheets.

Why Nine Trade Groups Are Backing It Now

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Nine trade groups signing one letter is a coordination effort that doesn't happen casually. The September 8 coalition letter represents, by the groups' own accounting, a majority of the companies, agents and brokers selling property-casualty, life, title and reinsurance products across the country. When groups covering that much market share align on a single piece of legislation, it tends to mean the pain point is structural rather than anecdotal.

Their argument centers on a specific kind of exposure: insurers and their agents can face federal liability simply for serving customers who have direct or indirect contact with state-legal cannabis, even when the underlying policy has nothing to do with marijuana itself. Think of a landlord's property policy where one tenant happens to be a licensed dispensary, or a life insurance application from someone who lists cannabis cultivation as their occupation. The federal-state conflict doesn't stay contained to plant-touching businesses — it bleeds into ordinary insurance products serving ordinary customers who happen to be adjacent to a legal industry.

The coalition's framing leans hard on consumer access rather than industry profit. Their pitch to Congress is that people shouldn't lose access to insurance protections — auto, home, life, title — just because they work in or near a state-legal cannabis business. That's a more sympathetic argument than insurers want more market, and it's likely deliberate messaging.

The bill's bipartisan sponsorship in both chambers — Velázquez and Davidson in the House, Cramer and Gallego in the Senate — signals this isn't a partisan wedge issue, which matters given how gridlocked cannabis policy has been in recent Congresses. Expect 2026 to bring the same sustained, incremental lobbying rhythm that eventually pushed SAFE Banking through multiple House votes, even if a Senate floor vote never materialized.

The Coverage Gap Insurers Are Trying to Close

Coverage gaps in cannabis business insurance are spread fairly evenly across market segments, with small businesses facing the largest share (30%) followed closely by ancillary services and infused products (25% each), and social consumption slightly behind at 20%.

Data from the National Association of Insurance Commissioners paints a consistent picture year after year: most commercial insurance for cannabis businesses still sits in the non-admitted market, meaning surplus lines carriers rather than standard, state-regulated admitted insurers. That's the high-risk lane, alongside things like flood-prone coastal properties or unusual liability exposures that traditional carriers won't touch.

The gaps are worst at the margins of the industry — smaller operators without the scale to negotiate favorable terms, ancillary service providers who work adjacent to cannabis without touching the plant, infused-product manufacturers facing product liability questions nobody has fully litigated yet, and social consumption lounges that don't fit neatly into any existing risk category insurers know how to price.

Meanwhile the insurable population keeps expanding. Medical cannabis is now legal in 42 states, and 24 of those states have also legalized adult-use cannabis. That's a lot of businesses, employees, landlords and consumers who need coverage, and the options available to them haven't kept pace with the market's growth.

Non-admitted coverage isn't necessarily bad insurance, but it comes with real trade-offs: higher premiums, less standardized policy language from carrier to carrier, and fewer of the consumer protections built into admitted-market regulation, like guaranty fund backing if an insurer becomes insolvent. If mainstream, admitted carriers were freed to enter the space at scale, the expected result is more competitive pricing and a broader menu of products — something closer to what a restaurant or retail store can shop for today.

Why Rescheduling Alone Won't Fix This

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It's tempting to assume rescheduling solves the insurance problem on its own, but the timeline and the substance both argue against that. Acting Attorney General Todd Blanche issued an order on April 23, 2026, placing FDA-approved and state-licensed medical marijuana products into Schedule III of the Controlled Substances Act. That's a narrower move than reclassifying marijuana entirely, and it triggered an expedited hearing that began June 29, 2026, specifically to weigh whether marijuana as a whole substance should move to Schedule III.

Even if that broader reclassification goes through, it doesn't automatically create insurance coverage for medical marijuana products or the businesses producing them. Schedule III status changes tax treatment under IRC Section 280E and eases research restrictions, but it doesn't rewrite state insurance codes or force admitted carriers to start underwriting cannabis risk. Insurance access is a separate regulatory lane from drug scheduling, and nothing in the rescheduling process directly touches it.

The Congressional Research Service has made a similar point about banking: it has said rescheduling is not likely to substantially alter the risk profile for financial institutions serving cannabis businesses, because the core conflict — federal illegality under the CSA even at Schedule III, since it remains a controlled substance — doesn't disappear. Insurers reading that assessment have drawn the obvious conclusion for their own industry.

That's precisely why the coalition backing CLAIM Act isn't waiting to see how rescheduling shakes out before pushing for legislative fixes. They view it as a necessary parallel track, not a problem rescheduling alone will resolve, no matter which way the DEA's hearing ultimately lands.

A Bill With a Long Memory

Velázquez's first version of this bill dates back to 2019, which means the insurance industry has now been waiting roughly seven years for a fix that, on paper, doesn't ask for much — just clarity that state-legal businesses can be underwritten without exposing insurers to federal criminal liability.

That timeline should sound familiar to anyone who's followed SAFE Banking, which took years of reintroductions, committee hearings and near-misses before it ever got traction, and which still hasn't become law despite passing the House multiple times. CLAIM Act appears to be tracing the same arc, just a few years behind.

What's different this time is the weight behind it. A coalition representing a majority of the property-casualty, life, title and reinsurance market didn't exist in the same organized form during earlier sessions. That's a meaningfully larger lobbying force than cannabis operators alone could ever muster on Capitol Hill, and it changes the calculus for members of Congress who might otherwise see this as a niche issue.

Still, weight isn't the same as certainty. Anyone running a cannabis business, or working in insurance and considering entering the space, should track both the House and Senate versions as they move through committee this session, and should confirm current state law before assuming anything has changed on the ground. Nothing in this bill is enacted yet, and the 2019 version is a reminder that endorsement letters and bipartisan sponsors don't guarantee a floor vote.

What stands out most here isn't the bill's mechanics — insurance liability shields are about as unglamorous as federal legislation gets — it's who's asking for them. For years, cannabis reform advocacy came primarily from operators, patients and state officials frustrated by federal inaction. Now nine of the country's largest insurance trade associations are telling Congress, in writing, that the status quo hurts their own members. That's a notable shift in the coalition pushing for reform, and it tends to move faster in Washington than industry-only advocacy ever does.

Until CLAIM Act or something functionally similar becomes law, the practical reality for cannabis businesses isn't going to change. Expect to keep shopping the non-admitted, surplus lines market, especially if you're a smaller operator, an ancillary service provider, or anyone touching infused products or social consumption. Budget for higher premiums and less standardized policy language than a comparable non-cannabis business would face, and don't assume rescheduling — whichever way that process resolves — is going to open up admitted-market options on its own.

The question worth watching isn't whether the insurance industry wants this fix. Clearly it does. It's whether this Congress treats CLAIM Act as a genuine companion to SAFE Banking, moving both in tandem with real floor votes, or whether it quietly stalls the way the 2019 version did, waiting for yet another reintroduction a few years down the road. Given how long this particular fight has already run, operators and insurers alike would be wise to keep expectations grounded in what's actually law today, not what's been reintroduced.