A new year brings new opportunities, and cannabis businesses have much to look forward to in 2020 (plus a few changes to look out for).

A major cannabis banking bill that made leaps of progress in 2019 may soon be passed in the U.S. Senate. The Secure and Fair Enforcement (SAFE) Banking Act would allow financial institutions and insurance providers to serve cannabis businesses without fear of federal repercussions. While the SAFE Banking Act’s fate isn’t certain, this is the furthest a cannabis banking bill has ever gone in the U.S. and a sign of progress. Along with the SAFE Banking Act, there are several changes coming to the industry in 2020.

Here are 5 things you can expect to see in 2020:

  1. The need for Product Liability Insurance is going to grow in the cannabis market, and the rates are going to rise as we move into 2020. Due to the increase in contamination claims from vaporizers and other products, insurance rates may jump up as much as 40%. The significance of that jump will vary depending on how the contamination claims are resolved, but expect to see some kind of increase. Insurance providers will be wary and on the lookout for potential liabilities before they write any product liability insurance policy.
  2. The Hemp and CBD sector will continue to grow in 2020. The federal regulations for manufacturing, distributing and shipping hemp and CBD are minimal, and companies are investing in production of a wide range of products including oils, capsules, clothing, lotions and more. Next year, we may see industrial hemp go into the federal crop insurance program, as it has seen some support. Secretary of Agriculture Sonny Perdue announced in October that they are developing the U.S. Domestic Hemp Production Program to create a framework for growing and manufacturing hemp in the U.S.
  3. State regulations are expected to grow tighter in the coming year. While there are many good actors who have standardized their labeling, some unscrupulous companies use the system’s loopholes to mislabel products and cannabinoid content. That means more lawsuits, more claims, and more state regulators looking closer. There’s likely to be an increase in fines and penalties in 2020, as non-compliance liability becomes a reality.
  4. Starting a business is easy, but maintaining a business is the hard part. Many cannabis companies are entering the second phase of development, and how they have built their foundation over the last few years will begin to matter. Any cracks will become evident, whether it’s failing to run state-required background checks on all staff or leaving gaps in security. If directors or officers have made missteps, they may have the financial consequences personally if their company does not have Directors and Operators insurance.
  5. While there will be an increased need for insurance in 2020, signs are looking up for the availability of policies and their limits. More carriers are entering the market, and more cannabis businesses as well. Higher liability limits are likely to be the norm up to $15 million for product liability. The limit for property insurance is likely to be up to $60 million.

What are your predictions for cannabis in 2020? Tell us in the comments below.