Cannabis: the fastest growing sector health insurance agents can cash in on

As of writing, 35 states have some sort of allowance for medical marijuana in their borders. And like other industries, these businesses have sales, research, marketing, transportation, administration, accounting, and security. All the components you need to make a business of any size.

So, are you thinking what we’re thinking? That’s right, this is a great opportunity for agents to get some extra green. Here’s how you can take advantage of one of the fastest-growing markets nationwide--that probably has small groups looking for coverage.

Growing like a weed

When we said the industry is growing fast, we weren’t kidding. Two years after Michigan legalized the plant for recreational use, the state collected data on how it was going. In 2020, Michigan estimated the industry's value at about $3 billion.

That was surpassed at the end of 2022. Back then, the industry employed approximately 13,500 people.

Sales are projected to top $3.5 billion in 2024. Michigan reported over 46,700 people employed in the industry at the beginning of the year, with only the state of California topping either of those numbers.

Keep in mind too, owning a Michigan business is cheaper overall. And, product is selling for a lower price than in California due to less taxes and fees for the store. As a result, more cannabis businesses—whether it be growers, manufacturers, or storefronts—are settling down in the Mitten.

The laws are changing to favor cannabis

The federal government plans to host a hearing in December to decide whether marijuana will be moved to Schedule III. This would put marijuana on the same playing field as many painkillers or appetite suppressants when it comes to dependency potential, medicinal benefits, and regulation. It is currently a Schedule I drug, the most regulated schedule.

But states can still make their own determinations on drug scheduling, so is Michigan stricter on the plant, or more lax?

In July of 2024, Michigan’s Cannabis Regulatory Agency wrote a memo to the DEA detailing all the reasons why marijuana should be rescheduled. Almost 130,000 patients had a medical prescription for marijuana in Michigan – for things like chronic pain, arthritis, and Alzheimer’s. This tells us that marijuana can be (and is) prescribed for a panoply of reasons. To meet this need, 11,500 caregivers were permitted to grow for those patients.

Can agents trust these businesses to pay their premiums?

One concern is mentioned in this memo, though, that creates somewhat of a barrier for hemp hawkers: banking. Because marijuana sales are still illegal at the national level, many federally regulated banks refuse service to these businesses. And if you’ve done an enrollment before, you know that no bank account means no enrollment.

But again, the state has a solution. There is an entire page on the Michigan Business Resource Directory dedicated to pointing these budding businesses to cannabis-friendly partnerships and resources. This page has everything from attorneys and credit unions to resume-building tips and certification trainings.

If that doesn’t mean marijuana is here to stay in this state, what does?

And we’d like to point out there are no health insurance resources on this page. Yet. How do they find a licensed agent? Who can they trust? Are there people who will pass your name along? 

Despite these businesses being federally illegal, SIC codes for dispensaries do exist. The same is true for grow operations. So these businesses do have a way of being analyzed by the federal government. More importantly for us, they can apply for group coverage.

And believe it or not, it has happened. Some dispensaries already offer all the same benefits any other business would offer their employees. We bet they would be interested in other types of ancillary benefits, too, if that’s something your agency offers.

So light it up!

Don’t leave money on the table. Many of the barriers that once surrounded this industry are being broken down not only in Michigan, but across the country. Currently, only 4 states leave marijuana completely illegal in all forms.

Each state is different. This opportunity is surely not limited to your immediate surroundings. So while the rest of the country (and agents) catch up, pinpoint this new customer base for your agency before the opportunity goes up in smoke. Better yet - network with the right group of professionals who are getting involved at the business-establishment phase, and you'll be in an even better position.