The Uncertainty Around Cannabis Insurance for Delta-8 THC Products
Delta-8 THC has exploded in popularity recently as consumers look beyond delta-9 THC and CBD for beneficial cannabinoid products. Yet, there is concern about delta-8 THC’s legal status, and although retailers are offering delta-8 THC products, regulatory issues are preventing ancillary industries like insurance and banking from providing services.
Let’s take a look at delta-8 THC, it’s similarities to intoxicating delta-9 THC, and concerns around adding delta-8 THC products to your business.
What is Delta-8 THC?
Delta-8 THC and delta-9 THC (usually just referred to as THC) are similar to each other in chemical structure. Both delta-8 and delta-9 have a double bond on their carbon atoms, but in different positions. As a result, the effects of delta-8 THC are similar to those of delta-9 THC, but less potent.
Delta-8 THC binds with receptors in a slightly different way due to this difference in double bonds, resulting in its weaker intoxicating effects. This makes delta-8 products an appealing option for consumers looking for milder experiences or a potentially legal alternative to delta-9 THC in otherwise illegal cannabis markets.
Is Delta-8 THC Legal?
Delta-8 THC can be extracted from both marijuana and hemp in differing amounts. Now that hemp cultivation and manufacturing is legal due to the 2018 Farm Bill, many producers are making the argument for the legal status of all hemp-derived cannabinoids, including CBD and now delta-8 THC. That means products containing CBD and delta-8 THC are theoretically legal where marijuana is still illegal.
Some states have addressed this “THC loophole” with laws aimed directly at delta-8 THC. In other states regulation of delta-8 THC may fall under existing THC laws. Manufacturers need to be aware of the local regulations for all the markets to which they ship.
The DEA has taken a hard stand on the legal status of all THC (synthetic or plant derived), and there is little to assume this would change for delta-8 THC. However, until the DEA better clarifies its stance on hemp-derived cannabinoid products, it’s likely they will continue to be sold on an unregulated market.
Can I Insure Delta-8 THC Products?
With producers now focusing on delta-8 THC, they are looking to obtain insurance policies with product liability, asset coverage, and more. Because delta-8 products exist in this legal grey area, it is unlikely that you will find an insurance partner that offers policies including delta-8 THC coverage. CannGen Insurance currently doesn’t include delta-8 THC coverage in its services.
Change may be coming with legislation that would provide legal protection to insurers covering cannabis in legal cannabis states. The Clarifying Law Around Insurance of Marijuana Act for 2021 would provide safe harbor for insurance providers covering cannabis companies in legal markets.
That would mean delta-8 THC products being sold in legal medical and recreational states could secure insurance coverage in the future. Until then, the uncertain legal status of hemp-derived delta-8 THC will make it difficult for companies to find insurance partners.
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Disclaimer: Information shared is for general purposes only.