Cannabis Insurance – What You Need To Know About It

To seek Cannabis Insurance as an insurance agent for clients in the legal Cannabis business – it is tricky, if you, as an insurance agent don’t know how to cover them.

Just so you know, Cannabis business is the same as any other normal business; after all, they face the same dangers and risks like that of a typical business – and add to that, the additional risks of transportation of expensive goods to grow and seek a consumable product.

You get it, right?

However, there are two strategies that you can keep in mind, if you plan to have a look at their policies –


Make use of excessive insurance coverage to minimize uncertainty

Insurance is nothing short of a balancing act. With premiums, claims and the various risks that comes with it – it’s a boon that today, more and more information are on our fingertips. For the insurance companies, it becomes very easy for them to calculate the risks of various claims of the clients.

But the issue is that the Cannabis industry lacks data on liability risks, legal hazards and operational costs that can affect a business. It’s not possible to predict what clients will face – they may face claims, and again, there’s no information on how much these claims can cost the clients.


What can be quantified, it should be done

One thing that’s for certain is that the clients will have to insure the hard costs of the equipment for Cannabis business.

Day by day, the rules and regulations are changing in one state from another, so, it’s a given that the growing manufacturing equipment of the clients will need regular maintenance from typical day-to-day wear and tear, and of course, any other predictable damage that may occur. This means the equipment may have to be replaced according to the industry’s standards.

That’s why, having Cannabis Insurance can help the clients to maintain the production and safety standards that might otherwise would have affected the business as a whole. Clients of legal Cannabis business can be tricky as there’s not much information on the industry to go upon – that’s why, having a talk with the clients about the benefits of Cannabis insurance is a safe bet as they learn to navigate the new yet expanding Cannabis industry.

Despite the mystery that surrounds the Cannabis industry, the Cannabis Industry is becoming legal – and of course, with it, comes risks, and new one at that. After all, there are multiple states, and each of them has their own rules and regulations on Cannabis products – and add to that, the supply chains, and which itself is on its way to become a new concern – that’s because the Cannabis industry is still a new market; and who would want to take risk without knowing the ins and outs first?

That is because the Cannabis products that are planned to reach the direct consumers through the supply chains, a client can still be held liable for injury or damage that can cause to the direct consumer through the usage of Cannabis products. A client can only do so much as to advise their direct consumers on how to use Cannabis products in such a way so as to minimize the negative impact – there’s also the risk of the client of having dragged through a legal battle by the direct consumer.

That’s because the Cannabis products when taken internally – in the form of edibles – they can have quite a heavy psychological effect on the direct consumers. And the consumers can take advantage of this fact against the client – this is because the legal action taken against such a client, it can take years to finalize; and it depends on the physical damage or injuries behind the claim. The impact that will cause to the client and his Cannabis business – it will ruin the client and will lead him to bankruptcy without having the proper measures in place.


This leads us to the main question at hand.

How can Cannabis Insurance protect the clients of a legal Cannabis business?

Insuring a Cannabis business is tricky – and you guessed it, risky. That’s because the legal status of Cannabis changes from state to state – and even within a state, the usage of Cannabis’ products varies. This happens because the risk of liability and criminal proceedings that comes with Cannabis business is much higher as compared to other business – and the best way to deal with these issues before that can – and will arise is to take steps on how you, as an insurance agent can minimize the risk of associated claims by ensuring a better financial future for the client.

There are a few areas where having Cannabis Insurance are beneficial – and the plus point?

The Cannabis Insurance can be tailored as per the Cannabis business.


Premises and property

If the client who has a Cannabis business has facilities that grows and manufactures Cannabis products that are consumable, then, know this that the client will have a great many deal of expensive equipment that will need to be insured the first time.

Say, if any untoward event happens such as electrical fire, then, having Cannabis Insurance will help the clients to get back on their feet safe and sound without having any risk to the financial future of their business.



If the client of a legal Cannabis business sells concentrates, edibles or say, Cannabis flowers, and if these products are intended for consumer consumption, then, the client will need Cannabis Insurance.

One may never know, but if the product that the client sells, may harm the direct consumer or say, causes other damages, then, the client will face claims – present and future – on property damage and medical bills.

The claims may be successful or not – but having Cannabis Insurance in place provides peace of mind to the client regarding the political and the social environment that surrounds the Cannabis industry – and even if something happens to the legal Cannabis business, having Cannabis Insurance will help the Cannabis business to stay afloat.