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| Lost Your Stash? You're In Good Hands |
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Posted by FoM on August 17, 2001 at 10:24:46 PT By Mark Lewis, Forbes.com Source: Forbes Magazine 
Usually when police arrest a pot smoker and confiscate his stash, he calls a lawyer. In California, he calls his insurance agent and files a claim for lost property. If he can prove he uses marijuana for medicinal purposes, chances are his claim will get paid. Until now, that is. A U.S. Supreme Court ruling has emboldened some insurance companies to change their stance on this controversial issue. "We will not pay any future claims," says Elenore Williams, a spokeswoman for State Farm Insurance in California. "Our policies are such that we don't pay claims on illegal contraband." This was a non-issue until 1996, when California voters legalized marijuana for medical purposes, such as when cancer patients use it to ease chronic pain. Since then, a small number of patients whose pot was lost or stolen have successfully filed claims for reimbursement based on their property-protection insurance policies. Insurers also have paid a handful of patients for marijuana plants confiscated by police, in cases where the charges later were dropped. These payments have not exactly been a major drain on the insurers' finances. "We've seen fewer than 10 of these claims," State Farm's Williams says. "Maybe three or four have been paid." Allstate spokesman Bob Daniels says his firm has paid out only four marijuana claims in California--and none since the Supreme Court issued its ruling in May. Allstate is trying to determine how the ruling applies to its business and has not yet come to a conclusion. "It's a complex legal issue," Daniels says. Although a number of states have now legalized marijuana for medical use, Congress has not followed suit, so federal law recognizes no such exception. In practice, federal prosecutors rarely go after small-time marijuana users, so it didn't matter. But the "buyers' cooperatives" established in California have attracted more attention, and the high court ruled in May that these cooperatives cannot claim medical necessity as a defense if they are busted for distributing marijuana. The idea behind the cooperatives is to give patients easy access to the drug, rather than have them skulking in alleys to buy it from street dealers. Keith Stroup, executive director of the National Organization for the Reform of Marijuana Laws (NORML), says the court's ruling was regrettable, but he adds that it was narrowly drawn and does not invalidate the state laws allowing medical use of marijuana. Stroup says insurance firms that have changed their policy either have misunderstood the court's ruling or are using it as an excuse to stop paying these claims. Corporations tend to be conservative, he says, and paying for somebody's marijuana "makes them nervous." Here's something else to make the insurers nervous: Stroup says that firms that stop paying marijuana claims may find themselves hauled into court. "If in fact a legitimate patient contacts us, we will offer them free legal assistance," he says. "We are not going to stand by and watch an insurance company gouge a sick and dying patient." That is just the sort of line a plaintiff's attorney could use to win a big award from a sympathetic jury. The insurance firms may find it far cheaper to pay these penny-ante property claims than to reject them and get sued as a result. Newshawk: Nicholas Thimmesch II Related Articles & Web Site: OCBC Versus The US Government Insurers Wary of Claims of Pot Losses Insurers Weigh Marijuana Payments Home Comment Email Register Recent Comments Help |
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| Comment #1 posted by Patrick on August 17, 2001 at 11:57:09 PT |
| Allstate is trying to determine how the ruling applies to its business and has not yet come to a conclusion. "It's a complex legal issue," Daniels says. You betcha it's complicated. It's about as complicated as musical chairs actually. When the music stops. The loser goes to JAIL. [ Post Comment ] |
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