Getting to a Groovier State: Coverage for Our Local Cannabusiness

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A couple weeks ago, I was enjoying my Sunday (which for me usually means eating junk food, hitting dabs, and watching TV), and an ad for State Farm Insurance came on—this time featuring Scooby Doo and the whole gang.

It seemed odd to me that a modern State Farm ad would use a cartoon that first aired in 1969.  The target demographic for someone shopping for State Farm insurance and the demographic for an out-dated cartoon seemed pretty conflicting, so I watched intently (as any Ad Grad would) to try and understand where they were going with this.

The ad starts out with the whole gang riding in the Mystery Machine, but then they veer off the road, and crash.  Velma knows what’s up (like she always does—CLASSIC VELMA) and sings the State Farm jingle to get their agent Lucy to appear (like in the other State Farm ads).  Not only does Lucy efficiently handle their car problem, she also manages to foil whatever mystery they were in the middle of solving when they had their accident.  The announcer came on with the tagline — “State Farm takes the mystery out of insurance…Get to a GROOVIER state.”

Groovier state!?  What does he mean groovier state?! Like the one I’m enjoying on my Sunday Funday?  Was that a blatant reference to smoking pot or am I just stoned? Could conservative State Farm be pandering to stoners on their couches on Sunday?  Then it hit me like a ton of bricks—I am their target demographic.

Me, a 30-something woman, canna-business proprietor, and legalization activist, is the target for a State Farm ad.

This ad first aired in 2013, just after Washington and Colorado legalized.  It seems pretty deliberate to me.  Why didn’t they go with The Flintstones or some other Hanna Barbera cartoon?  Why did they go with the one cartoon that actually had a bumbling stoner and his talking dog on their ad?

ShaggyScoobyFor me, leaving adolescence was realizing that Shaggy wasn’t bumbling at all—he was just high.  He wasn’t just a goofy, big eater–he was stoned, and had the munchies.  If you didn’t already know this, and I’m the first to tell you, I’ll give you a minute to collect yourself.  Now you’re probably reading this and thinking, “How progressive of State Farm!  I wish other companies would get on the cannabis band-wagon like them!” Well, hold that thought…I have a story to tell.

A few years back when my partner and I decided to open our business (a seed bank and head shop in Ontario, Canada), we realized we would need insurance.  We enrolled with a State Farm office in a different city, and had coverage for about a year or so—with no problems (how hard is it to take a cheque, amirite?).  While our premium was higher than a normal retail business (because ours is considered “fringe”), we were happy to at least have coverage, and to be running the business legitimately.  We got the basic coverage that is typical for small business owners to have that covers theft, damage, and injury—that sort of thing. After about a year, we decided we wanted to change the office we paid, and go to a local office instead.  There was one just down the street, so it seemed perfect.  All that needed to be done was a simple transfer of information between State Farm offices and we would be set.

A week or so went by, and we didn’t receive an update.  So my partner went down to the new State Farm office and asked what the hold-up was.  Much to our surprise, we were informed that our files would not be transferred to the local office.  We either had to deal with the original agent or no agent, and they would simply drop coverage.  There wasn’t much more of an explanation, just that they wouldn’t transfer the file.  Our original out-of-town agent called us back after a couple days and told us that the local office “didn’t feel comfortable supplying service to a business of our nature.”

Huh?  Why hadn’t they told us this a week ago? That doesn’t sound groovy to us at all, in fact, it sounds discriminatory.  Why would one agent allow coverage and another claim we are uninsurable?  We were told that it is the individual representatives choice of how they interpret the coverage to define who is and isn’t insurable.  Our local office believed they would be insuring a business that is involved with illegal activity, a business that is too “high risk”.  To our local office, we may as well have been selling heroin over the counter to small children.

They didn’t care that we were a successful, incorporated business, even a member of the Kingston Chamber of Commerce.  They didn’t care that there is a federal program in Canada which allows for the medical use of cannabis.  We were criminals, and we didn’t deserve coverage, at least in one office’s opinion.  We didn’t even deserve a phone call or explanation for that matter.

What was scarier—if one person’s interpretation of coverage can affect us so much, what would happen if we ever needed to claim?  What if the adjudicator decided at the time of claim that we were conducting illegal business since our inception, and instead void our coverage?  Would State Farm take insurance premiums from us but not pay when the time came?

We had to shield our business from that type of risk, so we dropped State Farm, (we told them they were too high risk for us!) and found other (expensive) coverage through the Chamber of Commerce.

To be honest, the conversation with the insurance agent wasn’t the first time (and definitely not the last time) that we experienced discrimination due to the “nature of our business”.  Canadian credit card and payment processors also have no interest in the cannabis market at all.  We can’t even get credit processing with TD—the very same bank we have our business account with.  We get telemarketers calling all the time, asking if we would like to switch to their payment systems.  But when it comes down to it, none have ever approved because of the nature of our business, and the fact that they think there is a high likelihood of fraud on our account (even though we have never committed or been suspected of committing fraud).  We don’t even bother applying anymore.

ScoobyDooVanIt isn’t just the traditional processors that are discriminating against our industry; Paypal is apparently just as bad.  We have heard countless horror stories about other “fringe” businesses like ours accepting Paypal for a while (letting the account accumulate a little money), only to have everything seized and their account shut down because they have been found to be “non-compliant” with the anti-drug Paypal Acceptable Use policy.  Just like the insurance agent, Paypal can decide whether or not what we do is illegal.  It’s based on their interpretation of our business, their policy, not the law.

Sure, there are ways to get around it, but we have integrity—we ensure everything we do is completely above board.  I’m not going to lie on a credit application about what we do; that in itself is fraud.

The retail landscape has changed dramatically in my lifetime.  We have to compete with online companies (with little overhead), which is incredibly tough—especially when you don’t accept credit cards.  For a small business, we must have a strong online presence just to compete with bigger international players.  Not only do our prices have to be the best, but we also have to be the best at what we do—ship faster and cheaper than other companies, have better selection of stock (not to mention lots of it), be more discreet, whatever–just to make up for the fact that we do not accept credit card payment.  Meanwhile the credit card companies are really losing out (not that I pity the credit card companies in any way—I just think it seems counterintuitive for one of the greediest businesses known to man to not want a piece of the cann-action).

You know what acually is groovy?  Sales in Colorado in the first month of recreational legalization amounted to more than $14 million, with a generated tax revenue of almost $3 million.  Beyond that, in Canada, cannabis has been a federally regulated (for lack of a better phrase) medicine for over 10 years.

Non-cannabusinesses who deny service to “fringe” businesses like ours on the basis of personal opinion makes said businesses look out of touch and outdated, not to mention they are alienating a huge part of their customer base as more and more Americans and Canadians have admitted to cannabis use.

My point is that cannabis isn’t going anywhere; the future is very green indeed.  It seems it’s about time for corporations to hop on the groovy bandwagon, for real.