Cannabis Insurance

What insurance coverages should cannabis businesses look for?

There are many insurance coverages that marijuana policies may provide. These include liability protections and other protections.

Liability protections normally guard against situations where a business could be held liable for harm that another party suffers. Some liability protections that businesses in this industry often get are:

• General Liability Coverage: Normally covers common accidents, such as “slip and fall” accidents, occurring on a business’s premises.
• Product Liability Coverage: Normally covers injuries and illnesses caused by products that don’t contain cannabis, which may include general products and cannabis accessories.
• Cannabis-Infused Product Coverage: Normally covers injuries and illnesses caused by products that contain cannabis.
• Professional Liability Coverage: Normally covers injuries and illnesses stemming from wrong advice or statements that employees make.
• Cyber Liability Coverage: Normally covers cyberattacks and data breaches that leak customer information.

There are other coverages that protect property against loss or damage, or might offer different protections. Some others that businesses might want are:

• Commercial Property Coverage: Might insure owned buildings, fixtures, equipment, products not containing cannabis, and products containing cannabis.
• Medical Cannabis Coverage: Might insure medical marijuana products that dispensaries or other businesses have in stock.
• Business Income Coverage: Might insure against ongoing revenue losses following certain types of disasters.
• Vehicle and Equipment Coverage: Might insure against accidents involving company vehicles.

How can segmented businesses in the cannabis industry insure themselves?

For cannabis businesses with segmented operations, each segment is typically a separate business that requires its own insurance policy. 

These businesses should work closely with an insurance agent who knows the cannabis industry well. A knowledgeable agent will be able to find cannabis business insurance policies that provide the needed coverages, without creating duplicate coverages whenever possible.

Are subcontractors covered by a business’s marijuana insurance?

Subcontractors typically operate as their own business, and thus they typically need their own insurance policy. A subcontractor might be named an “additional insured” and covered by a business’s marijuana policy in select situations, but this tends to be the exception rather than the norm.

An experienced insurance agent can help subcontractors assess their coverage needs, and choose a policy assuming they need marijuana insurance of their own.