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Cannabis is a controversial sector for Captive Insurance Professionals

Cannabis is a controversial sector for Captive Insurance professionals as there are legal risks for carriers, brokers, captive managers and actuarial firms. The good news is that it’s only moving in one direction. This industry is opening up. Take advantage of the value Captive Insurance offers. Check out this article from Captive Review.


We at FIRST MERCHANT BANK CARD SERVICES have been approached to provide a possible solution to this problem.

As we now understand it, the insurance industry is being very careful in the canna space, as a result, canna entities cannot secure the types of coverage they need because of “money laundering” concerns…they have no way to pay for their employee benefit plans, insurance plans etc.

To be more specific a sample answer provided us by industry representatives on this topic state:

No cash or cash equivalents are accepted due to Anti-Money Regulations. No money orders, cashier’s checks or third party checks are accepted. Credit cards vary by company but most do not allow it or only allow it for the initial premium. ACH, EFT or PAC must come out of either a checking account or savings account. Company checks are only allowed if the company is owned at least partially by the insured or if the company is the owner of the policy. Some insurance companies require the signature of all other owners to accept a company check. Wire transfers are rarely used anymore.

We believe that we have a solution to this problem and are happy to discuss it with those that are interested.

Please email us at [email protected] to engage in a dialogue.




As a broker of P&C insurance in all 50 States including California, we are not see the same problem that you are seeing. If a Cannabis business needs property and causality insurance, we are happy to write it for them. This is not a problem on our end. Please have them call us at 420 Friendly Insurance, or just visit

If you are speaking of Title insurance, it is my understanding that this has been an issue, but that there are Title companies that are will to write the coverage. You just have to search them out. Nothing personal, but I am not sure what you think the problem is.

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Thank you for your email. The information provided to us with limited to employee benefit plans that included life, disability, etc.


That makes even more sense to me. Since insurance is all State regulated it does not fall under the Federal government control. However that being said, any Insurance Carrier this does business with the Federal Government will not touch this issue at this time, because of it still being a Seclude 1 drug.

It is my understanding that this is the same issue with Title insurance. However, I know that in the P&C world and Life Insurance there are carriers that will write coverage.

This issue should all go away if or when Cannabis is declassified.



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