CEO: Bill Trzos

Sales: Will write more than $300 million in annual premiums in 2018

No. of local employees: 160

Headquarters: UTC

Year founded: 2009

Company description: A full service program administrator that offers a wide range of insurance solutions to more than 5,000 insurance agencies and brokerages nationwide

Workers in California’s growing cannabis industry are now more likely to be covered by workers’ compensation insurance in case they are injured on the job, whether they work in a growing operation, a retail marijuana storefront or another position related to the production or distribution of cannabis products.

The latest firm to offer workers’ compensation coverage to California’s cannabis industry is San Diego-based Atlas General Insurance Services, which launched its new program in August.

Chuck Holdren, executive director of programs with Atlas, said his company researched the cannabis industry and determined that a need existed to offer workers’ compensation coverage for employees. Atlas is now one of three companies offering such coverage to the cannabis industry in California, and the company plans to launch its program in other states that have legalized cannabis.

“There’s an incredible demand for this,” said Holdren, noting that California’s cannabis industry employs thousands of people throughout the state. Since Atlas started its new program in August, he said, the company has been “inundated” with requests for coverage that have come through Atlas’ network of partner-brokers.

Insurance Commissioner’s Call

In establishing its workers’ comp program, Atlas was answering a call to insurers put out last year by state Insurance Commissioner Dave Jones.

“We’re very excited Atlas is entering the market and providing workers’ comp to cannabis businesses,” said Jones. “It’s a multibillion dollar industry that is going to continue to grow. It’s important to have insurance protection available for consumers and anyone who interacts with the industry.”

Jones said his office began a concerted effort to encourage insurers to enter California’s cannabis market after the state’s voters approved the legalization of recreational marijuana by passing Propostion 64 in 2016.

The industry needs a variety of types of insurance coverage, including coverage for losses to marijuana crops, and for the health of key executives, both of which remain a challenge, Jones said. But through such efforts as meetings between cannabis and insurance industry representatives, and tours of cannabis facilities for insurance executives, Jones said he is working to expand the availability of coverage.

“I’m saying to the industry I regulate, we really want you to come into this market to provide insurance to cannabis businesses, the risk for you is very low and the potential benefits are very high,” Jones said.

Jones conceded some insurers are concerned that under federal law, marijuana remains an illegal, controlled substance. But he said he is convinced that the risk of federal agencies taking action against any insurer is basically zero, because insurance is regulated by states, not the federal government.

State Law

Holdren, with Atlas, said his company is comfortable with the current regulatory climate, and its new workers’ compensation program complies with state law.

The next market where Atlas plans to roll out its workers’ comp coverage to the cannabis industry will be in the northeastern United States, where such states as New York, New Jersey, Pennsylvania and Massachusetts have legalized medical and/or recreational marijuana, Holdren said.

The company is also working on expanding its offerings of types of insurance to the cannabis industry, such as general liability, crop insurance and commercial auto.

“Atlas is actively working to put together other lines of coverage to complement our workers’ comp program,” Holdren said. “Cannabis has the same needs as all other businesses.”

Injury Risk Relatively Low

Through its research, Holdren said, Atlas concluded that the risks of injury facing cannabis workers are relatively low. For example, most commercial cannabis crops are grown indoors, under controlled temperatures, with plants on waist-level tables. That reduces the risk of back- or heat-related injuries to workers. Cannabis workers are well-trained and well-paid he said, and companies are also very conscious of security.

“All of this was taken into consideration when we considered entering the cannabis workers’ comp market,” he said.

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