PIA has been advocating to protect insurance agents from federal prosecution for doing business with cannabis-related enterprises in states in which such businesses are legal. Nearly every state has legalized cannabis to some degree.
That said, PIA does not take a position on the legalization of cannabis and views this issue strictly a matter of respecting state insurance laws. In addition, given the evolving landscape of state law on this issue, insurance agents that engage in the business of insurance with businesses that comply with state laws must be protected from prosecution by the federal government.
To that end, PIA helped develop and supports two bills, both of which were recently reintroduced in the 117th Congress, which would provide protection for those engaging in insurance-related transactions associated with cannabis businesses that are otherwise legal under state law.
The Clarifying Law Around Insurance of Marijuana (CLAIM) Act is an insurance-specific bill introduced by Rep. Nydia Velazquez (D-NY) and Sen. Bob Menendez (D-NJ). The bipartisan bill includes Rep. Steve Stivers (R-OH) and Senator Rand Paul (R-KY) as sponsors. The CLAIM Act provides protections for the insurance industry to conduct business with cannabis-related businesses in states in which such entities are legal.
The second bill is the bipartisan Secure And Fair Enforcement (SAFE) Banking Act, introduced by Rep. Ed Perlmutter (D- CO) and sponsored by Reps. Nydia M. Velázquez (D-NY), Steve Stivers (R-OH), and Warren Davidson (R-OH). A Senate companion bill was introduced on March 23rd and is sponsored by Senators Jeff Merkley (D-OR) and Steve Daines (R-MT).
The SAFE Banking Act was initially conceived of as a banking-focused bill designed to address the same concerns the CLAIM Act was intended to address. In the last Congress, PIA and our coalition partners worked to incorporate key pieces of the insurance-specific CLAIM Act in the SAFE Banking Act before it was considered on the House floor, where it passed in 2019. However, the bill later stalled in the Senate.
PIA is pleased that the SAFE Banking Act has been reintroduced and that several key insurance pieces of the CLAIM Act have been included in the text. As introduced, the bill will prevent federal criminal prosecution of and civil liability for agents, brokers, and insurers when engaging in the business of insurance in states that have legalized cannabis in some form. We are making the passage of the SAFE Banking Act one of our top priorities this Congress.
PIA urges the 117th Congress to pass the SAFE Banking Act with the insurance protections from the CLAIM Act. We are working with insurance industry partners in support of both the CLAIM Act and SAFE Banking Act.