The cannabis outlook is constantly evolving, and this can make securing strong, complete insurance coverage a challenge. From legality changes to potential restrictions on specific compounds, concentration by dry weight, and more, the industry is in flux, and any marijuana-focused business is wise to adjust its cannabis insurance to match.
However, while responding to the existing situation is simple enough, businesses would find it advantageous to stay informed on emerging trends, enabling them to act before problems arise.
Here is a look into the possible future of cannabis insurance, including trends to watch that should influence your potential coverage decisions.
The Horn Case
In April of 2025, a landmark Supreme Court case (Medical Marijuana, Inc. v. Horn) altered how weed companies need to think about their products. A truck driver alleged that he consumed a product that was labeled as containing 0% THC. However, he subsequently failed a drug test, and he pursued legal action seeking financial compensation because he lost his job as a result.
The Supreme Court’s verdict was close, but the yeses prevailed: the driver should be entitled to compensation because he suffered a financial injury due to a company’s mislabeled product. The court deemed that such financial injury constituted personal harm, even if not physical.
This case has sweeping implications for cannabis companies and their liability protection, and it is just one of many more legal actions being brought before courts regarding marijuana products. This, in turn, will influence the insurance market and should prompt every cannabis business to reevaluate its coverage.
Trends to Watch
The Horn case stands out as a significant industry shifter, but more changes in the cannabis industry are also prompting new trends (both in products and insurance).
Greater Liability Concerns
The most significant pivot in 2025 may be the switch to stronger liability coverage. Now that there is legal precedent for companies to be liable if their product’s label does not match the customer’s experience, insurance coverage in this area is non-negotiable and should likely constitute a much larger portion of the overall insurance portfolio than before.
More Exclusive Cannabinoids
Another insurance challenge companies experience is how to cover the expanding roster of product compositions. Previously, basic cannabinoids such as THC and CBD were the primary ingredients in most products, and these have clear rules both federally and by state.
However, new compounds are increasingly entering the market: CBN, CBG, HHC, and even delta-8 or delta-10 THC. If the law does not speak on these directly, how can a business know it is compliant? This may also be a case for bolstered product liability insurance, errors and omissions coverage, or even a particular, customized option.
Banking Changes
Financial profiles are changing for cannabis businesses; previously, it was challenging to get insurers to underwrite a company that sold marijuana because of the risk and industry uncertainty. However, the recent SAFER Banking Act and CLAIM Act have made financial and insurance support for weed companies more favorable by reducing potential penalties for companies that serve cannabis businesses.
This may enable marijuana companies to take essential actions, including switching to higher maximum liability coverage and choosing more expansive protection previously blocked by unreasonable underwriting requirements that most businesses could not fulfill.
Risk Pooling
Because so many things in the cannabis business are still changing, the unpredictability makes it harder for companies to plan strategically. To limit the risks of failing to foresee changes or challenges, many cannabis businesses are grouping together, using risk pooling as insurance against new developments.
Risk pooling involves multiple businesses joining a collective pool of protection, shielding each member so that no one company is hurt unduly by a claim. This model has many challenges, including stringent selection criteria for joining. Still, until the insurance industry stabilizes around cannabis companies, trends show increased participation in risk pooling as an alternative approach to doing business safely.
Stay on Top of Cannabis Insurance Developments With MFE
Cannabis remains one of the fastest-growing industries in the world, and with that rapid growth, insurance is struggling to keep up. For companies looking to maintain their financial protections, paying attention to trends can help them pivot as needed and stay safe from financial harm.
The team at MFE Insurance has been working with cannabis companies for years as the insurance market has consistently changed, and we understand what sticks. Contact MFE Insurance for personalized coverage recommendations so you can do business confidently.