Column: Workers' Comp

Risk and the Cannabis Clash

By: | April 4, 2016 • 2 min read
Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

Risk management has sprouted a touch of cannabis-induced dissociative identity disorder — what used to be known as multiple personalities.

I’m no psychiatrist, but it doesn’t take a license to diagnose that a split in risk management personas exists when it comes to marijuana, each persona hoping their view of the world will eventually achieve dominance.


By far the dominant persona has risk managers and insurers nervous over weed’s increased legalization. Worker safety and employee liability stoke their angst, atop a general unease as the landscape shifts on prohibitions we have labored under until recently.

This personality fervently hopes a newly elected conservative president changes course from the current policy of ignoring enforcement of federal laws prohibiting marijuana.

You can sense the anxiety spread by blog posts contemplating topics like New Mexico’s mandate forcing workers’ comp claims payers to fund claimants’ dope consumption.

Insurance conferences offer up experts with advice on managing the workplace challenges created by marijuana’s increased accessibility.

Then there is a younger, emerging risk management personality. It’s the one looking to inhale revenue derived from selling insurance and loss prevention services to the weed industry. It’s fueled by entrepreneurial brokers with an enhanced sense that the new green revolution provides fertile ground for premium growth.

You can sense the anxiety spread by blog posts contemplating topics like New Mexico’s mandate forcing workers’ comp claims payers to fund claimants’ dope consumption.

The latter persona wants to help keep the party going, supplying medical-marijuana dispensaries, retail pot shops and grow operations with insurance products … including workers’ compensation coverage.

It first emerged at least six years ago when producers started supplying legal marijuana operations with London-market coverages for typical P&C risks.

This self-indulgent insurance personality also launched new, creative products for emerging risks. Raid coverage, for example, purports to insure against authorities busting marijuana businesses.

London markets tightened up cannabis-industry coverage availability. But that hasn’t slowed this insurance personality on display at cannabis conventions where brokers, alongside other vendors supporting the weed industry, offer their products and expertise. At these conferences there is talk that while weed legalization might not spread quickly, it will spread.


Obviously, I make the comparison to multiple personality disorder in jest. The two insurance viewpoints don’t exactly resemble conflicting voices vying against each other for dominance inside someone’s head. But they are different lenses through which to view an unfolding risk.

Which notion will dominate, if either, isn’t settled. But growing acceptance of marijuana and its increased availability ensures the issue will require risk management attention far into the future. &

More from Risk & Insurance

More from Risk & Insurance

2018 Risk All Stars

Stop Mitigating Risk. Start Conquering It Like These 2018 Risk All Stars

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.


But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.


Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &


Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]