Canadian cannabis companies should be thinking strategically about future expansion into some of the larger markets, such as Europe and the United States. Although doing so won’t come without insurance implications.
“We are certainly seeing some complexities there. Some of our clients and other companies within the industry are looking to do cross-border operations,” said Kevin Lea, president at Fuse Insurance. “If they are going to be setting up a US entity to be conducting operations in states where it’s currently legalized at the state level, it’s likely going to be a separate company that’s conducting those operations. You’re not seeing the direct Canadian arm operating directly in the US because that’s going to cause a lot of cross-border hassle.
“Within those legal states, there are also a number of insurance providers who are operating within the cannabis sector already – insurance companies that are regulated at the state level. One of the examples would be Next Wave, which has an office here in Canada now, but they pioneered insurance for cannabis down in the US. For our clients looking for cross-border [opportunities], we’re able to connect them with licensed brokers in those states, who are then in turn able to work with the appropriate specialist providers to find that coverage.”
View the full article from Insurance Business Canada here.