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PIA Supports Cannabis Safe Harbor Legislation

A matter of respecting state insurance laws.
March 18, 2021

WASHINGTON – The National Association of Professional Insurance Agents (PIA) has been advocating for a legislative protection from federal prosecution for insurance agents who do business with cannabis-related enterprises in states in which such businesses are legal.

In recent years, an increasing number of states have legalized either medical or recreational use of marijuana, or both.

"PIA does not take a position on the legalization of cannabis and views this issue strictly as a matter of respecting state insurance laws,” said Jon Gentile, PIA vice president of government relations.  “Due to the evolution of state law on this issue, PIA is dedicated to ensuring that insurance agents who work with businesses that comply with state laws are not prosecuted by the federal government.”

To that end, PIA helped develop and supports two bills, both of which were reintroduced on March 18, 2021 , which could provide a legal safe harbor for independent agents that engage in insurance-related transactions associated with cannabis businesses that are otherwise legal under state law.

The Clarifying Law Around Insurance of Marijuana Act (CLAIM) Act is an insurance-specific bill introduced by Rep. Nydia Velazquez (D-NY) and Sen. Bob Menendez (D-NJ). The bill provides protections that allow members of the insurance industry to work with cannabis-related businesses in states in which such businesses are legal.

The second bill is the Secure And Fair Enforcement (SAFE) Banking Act of 2021, introduced in the House by Reps. Ed Perlmutter (D-CO), Nydia Velazquez (D-NY), Steve Stivers (R-OH), and Warren Davidson (R-OH). A Senate companion bill is expected to be introduced soon.

The SAFE Banking Act was initially conceived of as a banking-focused bill designed to address the same concerns for the banking industry that the CLAIM Act was intended to address for the insurance industry. 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 SAFE Banking Act later stalled in the Senate.

“PIA is pleased that the SAFE Banking Act was reintroduced  this week and that several key insurance pieces of the CLAIM Act have been included from the start,” Gentile said. “As introduced, the bill will prevent federal criminal prosecution of and civil liability for agents, brokers, and insurers when they engage in the business of insurance in states that have legalized cannabis in some form.”

PIA will advocate for the prompt passage of cannabis safe harbor legislation that protects insurance agents, and we are making the passage of the SAFE Banking Act one of our top priorities.

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