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Charles Pyfrom, CMO of CannGen Insurance Services – Interview Series

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“There are many factors that have led to our success thus far, such as our comprehensive lines of coverage and our ability to work with businesses of all sizes, but they are all backed by our team’s commitment to helping to further legitimize the industry and showcase that the cannabis industry has many resources to reduce its risk profile.”

– Charles Pyfrom

Having cannabis as a schedule 1 drug creates a myriad of challenges. When it comes to insurance, not many providers are willing to engage marijuana-related businesses and the few that are willing are likely to charge high premiums to cater to the higher risk profiles. CannGen is spearheading the “world’s decision to work with cannabis” by offering comprehensive insurance coverage for the industry. They are the largest insurance company providing underwriting services to over 10,000 legal marijuana businesses across different states.

In this brief interview, the chief marketing officer of CannGen, Charles Pyfrom, sheds light on what it takes to weather the storms that come with such territory and make some huge wins in the process.

Meet Charles

As an intro, how did your career path lead you to the cannabis industry?

As an insurance industry executive with nearly a decade of experience before getting involved in the cannabis industry, it wasn’t necessarily something that I thought I’d ever get into. But as I began to see more and more emerging businesses and opportunities within cannabis, especially in California, it became increasingly interesting to me and I saw it as a unique insurance category to help spearhead. Once more states started establishing legal cannabis markets, I knew it was time to step in and assist in providing cannabis companies with the coverage they need and deserve.

Can you briefly introduce CannGen Insurance Services and the unique role that this company is playing in moving the cannabis industry forward?

CannGen became the first Managing General Underwriter (MGU) to exclusively focus on the legal cannabis industry in 2008. Underwriting for both ancillary and plant-touching companies in the cannabis industry, CannGen has become a one-stop-shop for comprehensive insurance coverage in all legalized states in the U.S. CannGen’s offerings are ideal for start-up businesses, multi-state operators, and all businesses in between as CannGen offers highly customizable products depending on a company’s needs. The Company’s key offerings include property coverage, crop coverage, general liability coverage, product liability coverage, directors and officers, employment practices liability, commercial auto insurance, motor truck cargo, workers compensation, and excess liability coverage.

You serve as the Chief Marketing Officer of CannGen. What does this role entail?

In my role as CMO, I’m utilizing my knowledge of insurance and business strategy to connect with entrepreneurs, business owners, and investors to help them understand our offerings and the coverages for their specific businesses. In addition to my work to promote the business across marketing channels, I’m also responsible for ensuring that our agents are providing the best service to our customers and that we are expanding our offerings to match the industry’s needs.

CannGen has spearheaded the “World’s decision to work with cannabis businesses” in terms of offering insurance to the fledgling industry. Insurance can be complicated, even without mentioning the complicated nature of cannabis regulations. Is there one thing that you can attribute this success to?

There are many factors that have led to our success thus far, such as our comprehensive lines of coverage and our ability to work with businesses of all sizes, but they are all backed by our team’s commitment to helping to further legitimize the industry and showcase that the cannabis industry has many resources to reduce its risk profile. There are still business professionals who are hesitant to get involved in the industry but our job has been to help them understand that despite some unique regulatory hurdles that exist exclusively for cannabis, we can strategically find ways to make the reward outweigh the risk.

What are some of the most significant challenges that are associated with insuring the cannabis industry?

The most significant challenge is that many people in the industry have a false belief that it is difficult or impossible for them to secure the coverage they need. In reality, CannGen makes it very easy for operators in every state where medical and/or recreational cannabis is legal to secure their assets through appropriate risk transfer solutions.

Another challenge is working across a variety of state and local regulatory environments as we offer our products in all states that have legal cannabis markets. We have to stay up-to-date on what these regulations entail and offer sound recommendations to our customers so that they can stay covered and compliant.

Has the cannabis industry been receptive to your services?

Yes, we provide underwriting to over 10,000 legal cannabis-related businesses and continue to work with some of the largest multi-state cannabis operators in the US. We are the industry-leading – cannabis-dedicated – largest underwriting facility to provide these types of businesses with such comprehensive coverages and our goal is to continue to make sure that rings true in the future.

Does the cannabis industry have greater insurable risks/liabilities compared to traditional agricultural and manufacturing businesses?

The cannabis industry has many related but different risks due to its Schedule 1 drug status in the US. Product production and warehousing present similar risks as you might find in other industries, but the guidelines of how cannabis businesses can operate are much more strict. Also, because cannabis is a mostly cash-run business the risk of robbery and theft is much higher than in other industries that have resources to keep their cash safe. The legal industry in many states is also relatively new so that presents a number of risks as these new cannabis businesses are learning how to establish a safe and secure facility.

What’s your take on the Clarifying Law Around Insurance of Marijuana (CLAIM) ACT? Is this bound to improve insurance coverage for the cannabis industry?

A few legislative bills have been introduced over the past two years that would make insurance and compliance measures easier to attain sufficient coverage and stay protected. This includes the Clarifying Law Around Insurance of Marijuana (CLAIM) Act and the Secure and Fair Enforcement (SAFE) Banking Act.

The CLAIM Act, if it became a law, would “provide a safe harbor from penalties or other adverse agency action” for insurance companies that provide services to legal cannabis-related businesses, enabling additional capacity from both issuing carriers and reinsurance providers for the industry.

What’s next for CannGen?

We’re always paying attention to industry trends and new types of cannabis businesses popping up every year. For example, there has been an uptick in cannabis consumption lounges in legal markets and we want to help figure out how to provide them with the best coverage to keep them safe and compliant. We’re also looking to expand the scope and limits of our coverages and be able to continue to service cannabis businesses of all sizes.

It was a great pleasure to have this one-on-one with Charles Pyfrom, CMO of CannGen Insurance Services. Readers who wish to maintain pace with the new developments are more than welcome to visit their website.

Lydia K. (Bsc. RN) is a cannabis writer, which, considering where you’re reading this, makes perfect sense. Currently, she is a regular writer for Mace Media. In the past, she has written for MyBud, RX Leaf & Dine Magazine (Canada), CBDShopy (UK) and Cannavalate & Pharmadiol (Australia). She is best known for writing epic news articles and medical pieces. Occasionally, she deviates from news and science and creates humorous articles. And boy doesn't she love that! She equally enjoys ice cream, as should all right-thinking people.

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