When Canada’s official legalization date for recreational marijuana was set for July 01, 2018, stock jumped and speculation focused - but actual concrete details are still elusive.
The medical side of marijuana in Canada is already established and its insurance design may provide clues on how recreational coverage will look in the future.
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Growing at home, for example, is legal for patients - and writing better policies for homegrown marijuana could lay the groundwork for what becomes legal beyond the prescription. However, the medical and recreational realms of marijuana have their differences with dispensaries occupying a grey zone in-between.
Covering medical marijuana’s commercial liabilities, properties and plants grown at home is a line of business AC&D Insurance operates and its vice president, Brody Stonehouse, said there’s been an evolution in the medical market as legislation creeps towards recreational authorization.
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“Insuring dispensaries hasn’t changed that much but insuring other operations has,” he explained. “There’s a lot more of a market open for commercial space rental for the people who pool their (growing) licenses together.
“Typically what happens is several patients… pool their licenses and grow in a commercial space. So there is home insurance too, for people to grow at home, but it’s not good enough for mortgage companies right now - they don’t accept them at banks because it doesn’t cover replacement costs.”
However, Stonehouse said “I expect that will change very soon” in light of the legalization date announced and parameters expected.
The product itself will also become subject to rigorous testing when weed goes legal.
“Government legalization is going to lead to a lot more testing and we understand the product more already because it’s legal in other countries and jurisdictions,” Stonehouse said.
“The Marihuana for Medical Purposes Regulations - they have very strict rules for testing the product and they’re still the only ones allowed to sell it to licensed producers.”
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