In this piece, you would understand the tips that would help you insure your hemp business appropriately and as well what your business coverage is eligible for. After the 2018 Farm Bill was passed into law, Hemp business has become eligible for insurance coverage through the US Department of Agriculture and federal crop insurance program.
This new law meant that farmers in the short and long term can now insure their business and the varieties of options available for them.
As against the popular belief that the 2018 Farm Bill was not a free market for the hemp business and free for the US hemp industry. Although the hemp market is volatile and uncertain there are some benefits the business can gain from insuring the entire business and its assets.
Although in the cannabis industry, the federal government still criminalizes the sale and use of marijuana, laws about cannabis in different states vary which is why Law enforcement agencies can still crack down heavily on any hemp-related business. Big organizations have been cracked down by the law enforcement agency after a series of warnings from the authorities.
These times are very stringent for the hemp business as the law and regulations can be very unpredictable and there are a lot of risks associated with the business. While farmers have been investing in planting and harvesting their planted hemp, the Farm bill has been the only government policy that might seem to be the support for them. Hemp Crop Insurance is still the only coverage businesses in the hemp planting and harvesting section of the business can easily benefit from.
Some Doubts About The Farm Bill
Although the farm bill seems like an insurance for most farmers, however, there are some doubts about the laws the bill upholds and the huge impact it has on hemp growing and insurance in the United States. Yes, the US Farm bill enables the state to launch a program into the industrial hemp research programs, while in 2018, the farm bill took legalization to another level, as it removes the hemp from the control substances. Hemp that contains 0.3% tetrahydrocannabinol and lower is now allowed as agricultural production or commercial product.
This means that hemp is now a product covered under the U.S. Department of Agriculture’s (USDA) federal crop insurance program, however, growing of the crop isn’t included in the coverage. With the growing of hemp out of the list of what the farm bills covers, Hemp Crop Insurance is the only alternative for farmers who aim to plant hemp.
All thanks to the Farm Bill the hemp farms and growers are now able to buy a subsidized crop insurance policy based on the revenues, the yield, or to cover any loss of crop, drought, pest infestation, or other natural causes.
The USDA and the FCIC also offer hemp farmers coverage under the farm revenue protection insurance policy which was instituted in the year 2020 crop year. There are some complications with the 2014 farm bill, the review made to the 2018 farm bills still left everyone waiting for the final USDA implementation of the bill. Although the bill might sound complicated as there are so many sections of the bill that are excluded by the government and only the private insurers can provide such.
For some reason, preparing the insurance budget and funding the cost of your hemp business policy can be a challenging task which is why so many farmers prefer to explore the private insurance policy for their hemp business as against the farm bill reliance.
Tips You Should Consider When Insuring Your Hemp Business
Given that the crop insurance policy is one of the topmost priorities for hemp growers and farmers, some hemp growers experts have revealed that there are options of what hemp farmers can leverage when it comes to insurance. The 2018 farm bill transition period also helps support the hemp farmers although there are some sections left out. Here are some tips to help you as a farmer visualize your hemp business and also ensure the insurance of your corp is achieved.
Think Like Any Other Business
Insuring your hemp business should be viewed as if you are insuring another type of business that is outside the cannabis industry, as the federal crop insurance isn’t still made available for many farmers yet. In the meantime, hemp businesses can easily secure their business coverage and prevent loss through the private insurance and brokerage agencies that are certified to ensure crop products.
More so, because every industry is quite different, the baseline for traditional business and the coverage claims might vary. For hemp farmers and growers, there are some lists of essentials that should be considered as what they should include in their insurance policy.
This list has been made available by experts who have been in the business for a while the list includes:
- Product liability
- General liability
- Cyber liability
- Workers compensation
- Property/ casualty insurance and many more
Manage Your Business Risk Step By Step
Yes, business risks are quite many, and they can come upon different occasions. However, with the help of an insurance policy, you can easily get cover from any business casualty. The 2018 farm Bill that legalizes hemp was a compromise between the federal and state regulations. More so, the state authorities can act as the primary regulators of hemp production, as long as the regulations and rules are adhered to.
More so, with the hybrid laws that protect some aspects of the business relating to distributions, transportation, testing, and quality control, some states are more lenient than others. The insurance policy covers different aspects of the state-specific risks, while the cannabis law must be fully adhered to.
The goodness is that the state by state strategy and 2014, 2018 farm bill laws have enabled a bridge between the state and the federal government on how they regulate the hemp business.
Take In Mind The Mitigation Roots Risks
Since the criminalization of hemp has just been reviewed there are many insurance companies that have not provided a policy for hemp business owners yet. More so, the insurance products are being reviewed day in day out to help fit the needs of the farmers in the cannabis industry.
There would be ample time for most insurance companies to work on before the market becomes competitive where other features that fully support the interest of the hemp farmers can be implemented. Until that time there would be a lot of out coverage section in the cannabis business coverage for hemp business owners.