(Reuters) - Since last year, Californians are allowed to grow and possess marijuana. Now, the most populous U.S. state has taken another step to bolster the cannabis business by deciding to give insurance cover to the multi-billion dollar industry.
The state’s Insurance Commissioner Dave Jones approved on Thursday the filing of the first commercial insurance company to cover cannabis business.
The insurer, Golden Bear Insurance Co, can now begin writing policies and offer coverage for cannabis business owners, spokesman Erik Olsen told Reuters.
For long, big insurers have been avoiding the cannabis industry worried about action from federal authorities.
California voters approved medical marijuana in 1996, despite a federal ban, and last year approved recreational use of the drug by adults. Since then, the state has been developing rules to allow recreational sales.
Jones launched an initiative earlier this year to encourage commercial insurance companies to fill insurance coverage gaps for the cannabis industry.
“Our mission remains insurance protection for all Californians, which includes insurance for California’s legalized cannabis businesses and customers,” said Jones.
Reporting by Sonam Rai in Bengaluru; Editing by Arun Koyyur