Concerned that U.S. Attorney General Jeff Sessions is going to make good on threats to cause trouble for those involved with the legal marijuana industry, Hawaii’s biggest workers’ compensation insurance firm has severed all ties with the state’s medical marijuana operations.
According to a report from the Honolulu Star Advertiser, Hawaii Employers’ Mutual Insurance Co. (HEMIC) recently informed seven of the state’s eight medical marijuana dispensaries that it was cancelling their policies. The report indicates that this decision was made unanimously by the insurer’s board of directors because of concerns that their affiliation with the cannabis trade would leave them open to prosecution under federal drug laws.
“A strict interpretation of the conflicting state and federal laws would expose companies doing business with medical marijuana dispensaries to criminal prosecution under federal law,” the company said. “This may include the personal assets of the members of its boards.”
The insurance company insists that the decision to disconnect from the medical marijuana industry was nothing personal, said HEMIC Chief Executive Officer Marty Welch. But still, since state law requires all businesses to maintain workers’ compensation insurance, the situation could delay the full implementation of the state’s retail medical marijuana program.
The state’s dispensaries must now secure a substitute insurer to cover things like loss of wages and medical bills in the event an employee is injured on the job.
“We’re not providing an opinion or moral judgment on someone’s use of marijuana or not, and we’re certainly not taking a position opposed to the value of medicinal marijuana to treat certain medical conditions or chronic pain,” Welch told the Star Advertiser. “This was really simply a legal decision.”
Unfortunately, this is not the first incident where a financial company has used the Justice Department’s “federal crackdown” comments as reason to end a business relationship with the legal marijuana industry.
Just last week, PNC Bank notified one of the nation’s leading pro-pot advocacy groups, the Marijuana Policy Project, that it was closing its accounts due to the threat of federal prosecution.
“They told me it is too risky. The bank can’t assume the risk,” Nick Field, the organization’s COO, told the Washington Post.
Although there have been a number of Jeff Sessions-lead precursors suggesting that the Justice Department is building a case against marijuana legalization, no policy changes have yet been made.
Incidentally, the Justice Department has never so much as investigated a financial firm for its involvement in the legal cannabis trade.