The Department of Justice (DOJ) issued an order on April 23, 2026, rescheduling state-licensed medical marijuana and Food & Drug Administration (FDA)-approved cannabis products to Schedule III of the Controlled Substances Act (CSA). The order is also expected to jumpstart the stalled Drug Enforcement Administration (DEA) rescheduling process for adult-use marijuana, which currently remains in Schedule I. The order, therefore, narrows but does not eliminate federal prohibitions.
Historical Insurer Treatment of Marijuana
For years, federal illegality and Schedule I status fueled blanket exclusions, limited capacity, and encouraged a reliance on the excess and surplus (E&S) market, where bespoke forms and higher premiums filled coverage gaps. Large commercial insurers consistently cited federal illegality and related banking/Anti-Money Laundering (AML) concerns as the principal reasons to stay out, with reputational risk present but fading over time. Federal AML rules under the Bank
