May 8, 2012

Dangerous Precedent: Insurance Firm Denies Malpractice Coverage for Lawyer With MMJ Clients

Medical marijuana ban on pot dispensaries and pot growers, dispensary raids

Pay particularly close attention to the recent experience of Denver attorney Ann Toney, whose insurance company essentially decided to yank her malpractice coverage. Why? Because some of her clients are involved in the medical marijuana industry.

The move by Hanover Insurance Group is extremely worrisome for ancillary MMJ companies.

Scores of banks have already stopped doing business with dispensaries and growers, as have many landlords in some cities. The fear is that a similar mentality could spread to businesses that are tied to the medical cannabis industry in some fashion but do not deal directly with the plant – such as law firms, accountants and insurance providers.

That’s exactly what happened with Toney. According to the Denver Post, Hanover Insurance Group told the attorney that it would not renew her liability coverage, saying that it cannot extend such insurance to practices that represent medical marijuana companies.

It’s particularly interesting to note that Toney has had medical marijuana clients for several years, yet the insurance company has just decided to take issue with it now.

If more insurance companies follow suit, the entire MMJ industry could find itself facing another crisis, as many law firms would no doubt sever ties with medical marijuana businesses. The other worry is that costs could rise for these services because firms would see MMJ as a greater risk and would therefore charge more.

But Brian Vicente, a medical marijuana lawyer in Denver, said he’s not sure insurance companies can justify this stance.

“I’m concerned that this could spread, as insurance carriers can be very risk averse at times,” Vicente said. “However, there are many (lawyers) out there who represent the mob and child molesters, and the fact that (an insurance company) would say that’s OK and medical marijuana isn’t doesn’t make sense.”


2 Comments:

  1. this is nothing more than strong arm tactics being sanctioned by the unprecedented raids on the medical cannabis industy. If we sit back and dont stand up together we will be forced back to drug cartels, and back alley deals.

  2. We were just notified today that our medical malpractice coverage for our physicians will be cancelled if we are recommending medical marijuana to patients. This can and will have a very serious impact on physicians supportive of medicinal use as most will not be willing to risk such exposure.

Post Your Comment:


Please note:
Comments are moderated by our editors who do their best to approve comments ASAP. As Marijuana Business Daily is focused on business, we approve comments that are specifically relevant to industry professionals. General opinions and questions about cannabis may not be posted.

Louisiana Officially Legalizes Medical Marijuana

Louisiana Gov. Bobby Jindal has signed a bill making his state the 24th in the [click to continue...]

New York Cannabis Firm Buys Oregon Utility Building for $3M

In another sign of the marijuana industry’s growing national reach, a New York-based real estate [click to continue...]

WA Moves Closer to Overhauling Marijuana Tax Structure

cannabis taxes

Washington State growers and processors would no longer pay a 25% tax on cannabis and [click to continue...]

Sole MMJ Dispensary Opens in Delaware

Delaware’s only licensed medical cannabis dispensary officially opened in the northern town of Wilmington on [click to continue...]

Canadian Cultivator Tilray to Lay Off 61 Employees

Canadian medical marijuana producer and distributor Tilray said it will lay off 61 employees as [click to continue...]

South Dakota Tribe to Partner With Colorado Grower

native american cannabis

A South Dakota tribe announced this week that it is teaming up with a cannabis [click to continue...]

Startup Acquires Inventory Tracking Firm, Plans Banking Solution

A Los Angeles-based financial services startup backed by a notable investor announced Thursday that it [click to continue...]

Vancouver Will Regulate Dispensaries Despite Federal Ban

The Vancouver City Council has voted to create a bylaw governing the city’s many dispensaries, [click to continue...]

Measure to Sink Ohio Cannabis Legalization Effort Passes House

ohio cannabis legislation

Correction: The initial version of this story incorrectly reported that the measure to prevent monopolies [click to continue...]

Cannabis Companies Dropped From Denver Fair

Marijuana companies apparently aren’t welcome at the Denver County Fair this year. The fair’s organizers [click to continue...]

Big Names in Canadian MMJ Industry Merging

Two of Canada’s largest licensed medical marijuana ventures are merging, which will create the country’s [click to continue...]

Nevada Dispensary’s Launch Delayed Again

dispensary delays

A Nevada company that hopes to open the first dispensary in the state has been [click to continue...]

California Medical Marijuana Grow Raided

Local law enforcement officials in a town just south of San Francisco raided a medical [click to continue...]

Study: Edibles Potency Claims in CA, WA Often Inaccurate

Edibles products in several major cities on the West Coast often include misleading labels that [click to continue...]

Marijuana Business Daily