California Enacts Legal Protections for Cannabis Insurance Providers
On September 18, 2022, California Governor Gavin Newsom signed a number of cannabis-related bills, including Assembly Bill 2568 (AB 2568), which makes it clear that it is legal for people and businesses with a license from the California Department of Insurance (CDI) to offer insurance or related services to people with a license to engage in commercial cannabis activities. The purpose of this new law is to remove any ambiguity, and to promote the continued expansion of admitted insurance products for California cannabis businesses, even though the California Civil Code was amended in 2018 to explicitly state that cannabis is the legal object of a contract and that insurance contracts are legal in California.
Section 26261 of the California Business and Professions Code is added by AB 2568.