Markets in Focus

Cannabis Insurance

Q2 2021

Markets in Focus | Cannabis  |  Cannabis Q2 2021

Though many industries struggled in 2020, the cannabis sector saw an unprecedented year of growth with total U.S. sales increasing from $12.1B to $17.5B and global sales increasing from $14.4B to $21.3B from 2019 to 2020, respectively1. Though the industry was not immune to PPE requirements, occupancy limits, and constantly changing regulations in 2020, demand still received a significant uplift as most Americans spent more time at home and New Jersey, Vermont, Arizona, Montana, and South Dakota joined the 10 other fully legalized states in October and November of 2020.

The industry appears to be gaining significant momentum in the court of public opinion as well, as the latest survey conducted by the Pew Research Center (April 2021) showed that 60% of those surveyed believe that cannabis should be fully legal, 31% believe it should only be legal for medical use, and only 9% believed it should not be legal at all. Amazon, the largest publicly traded company in the world, has also stated that they support the legalization of cannabis and that they will no longer include the substance in the company’s pre-employment drug tests.2 There appears to be a direct correlation in the improvement of public opinion of cannabis with the increase in states that have legalized, contributing to BDSA’s estimated 134% increase in total sales over the next six years. As Americans become more comfortable with cannabis, it is safe to say that the industry will continue to boom and could get some help from Washington in the form of two potential bills.