What is it?
Who needs it?
What is cannabis insurance
The legalization of medical and recreational marijuana has created many new business opportunities, and with each new opportunity comes new risks. California businesses that are entering this industry can help protect against risks by purchasing cannabis insurance.
Cannabis insurance policies provide specialized insurance for businesses in the cannabis/marijuana industry. Policies normally protect against common and uncommon risks.
What California businesses should have marijuana insurance?
California businesses that make and/or sell marijuana products might want marijuana insurance. Growers, producers, processors, distributors, wholesalers and retailers may all need the insurance.
A few particular examples of businesses that would likely benefit from a policy are:
- Conventional cultivators
- Hydroponic cultivators
- Oil/tincture extractors
- Edible bakeries
- Distributors/wholesalers
- Dispensaries
- Retail CBD stores
Just because these businesses can likely benefit from the protections that a marijuana insurance policy provides, doesn’t mean that they all need the same marijuana policy. An insurance agent who’s familiar with marijuana policies can help businesses find a specific policy that’s well-suited for their situation.
What coverages do cannabis business insurance policies come with?
Marijuana policies can offer different coverages, which is what allows them to be tailored for particular businesses. Some of the coverages that policies might make available are:
- General Liability Coverage, which may protect against common “slip and fall” accidents that occur on a business’s property
- Product Liability Coverage, which may protect against injuries and illnesses that general products and cannabis accessories cause
- Marijuana Infused Product Coverage, which may protect against injuries and illnesses that cannabis products cause
- Professional Liability Coverage, which may protect against incorrect statements and bad advice by employees
- Cyber Liability Coverage, which may protect against online attacks and data breaches that compromise customer data
- Commercial Property Coverage, which may protect owned buildings, fixtures, equipment, general products and cannabis products
- Medicine Coverage, which may protect medical marijuana products that dispensaries or other businesses have
- Business Income Coverage, which may protect against sustained revenue drops following covered disasters
- Vehicles and Equipment Coverage, which may protect against accidents that involve business-owned vehicles
How should segmented businesses in the cannabis industry insure themselves?
While segmenting might be a smart move for certain businesses, it creates complexities when evaluating insurance policies. In most cases, each distinct business needs its own insurance policy.
An agent who specializes in cannabis policies can help ensure that each component of a segmented business is properly insured.
Are subcontractors covered by cannabis business insurance policies?
Subcontractors are their own business entities, and they’re usually responsible for procuring their own insurance. They frequently don’t receive insurance coverage from a business that hires them, although coverage can be extended in select cases. Subcontractors should generally plan on purchasing their own insurance policies, though.
How much are premiums for cannabis business insurance policies?
Premiums for cannabis business insurance policies vary, as they’re based on numerous different factors. Some of the details that can influence cost include a business’:
- Particular sector
- Product mixture
- Annual sales
- Facility location
- Facility size
- Years in business
- Claims history
Businesses can find out exactly how much they’ll have to pay for insurance by comparing quotes with an independent insurance agent. Independent agents aren’t connected to any one insurance company, and thus can help compare quotes from different companies.
How can California businesses get a cannabis insurance policy?
If you need assistance insuring a California business that’s in the cannabis and marijuana industry, contact the independent insurance agents at Heffernan Walton Insurance. Our agents will work closely with you to determine coverage needs, and then we’ll help you find the best available cannabis insurance policy that meets those needs.