The cannabis industry is projected to generate $22 billion in sales by 2022. Despite this growth, insurers have been slow to enter the market. This has left many growers and dispensaries with an inadequate selection of insurance options to choose from. Cannabis insurance is available to those in the industry and helps to cover unique coverage areas.
Some of that initial tentativeness has dissipated and cannabis businesses are steadily gaining access to comprehensive cannabis insurance policies. With a strong policy in place, cannabis businesses are safe in the knowledge they are protected against potential risks.
Advantages Of Cannabis Insurance
A cannabis insurance policy has the potential to bring along many benefits with it. This policy is designed to protect your cannabis establishment, and provide coverage to the unique areas of need. The benefits of this policy are as follows:
Provides Your Employees With a Great Benefits Package
Cannabis insurance providers are capable of offering great benefits packages to employees. Until recently, most insurers would offer only the most basic policies. Now cannabis businesses are able to offer more.
In the United States, 71% of cannabis companies offer medical insurance to employees, with 51 % providing dental care. This is an example of how comprehensive cannabis insurance allows employers to offer excellent benefits packages to full-time workers.
Furthermore, it can also protect against administration errors. For example, if a new employer is added to the team, they should also be added to the company’s medical insurance policy. If this does not occur and they need to use this medical coverage, cannabis insurance can cover the costs in the event the employer sues for their medical coverage.
Protection From Unfortunate Events
Entrepreneurs need a comprehensive insurance policy to protect them against any unfortunate events which may occur. Cannabis insurance policies are fully customizable, but minimal coverage will guarantee protection for any property the business owns, its equipment and any vehicles used for transporting cannabis products.
Standard coverage will typically cover damage caused by natural disasters and vandalism. The extent of this protection and the circumstances covered depends entirely on the policy. A higher level of protection will always come with higher premiums. Basic protection will also cover liability issues and any settlement or legal fees incurred by the business.
General Liability For Cannabis Businesses
General liability coverage protects against accidents involving those who are not affiliated with the company. If the business is sued, the policy will cover legal fees, settlement fees and any major medical costs.
For example, if a customer walks into a dispensary,trips over the door entrance, and sustains bodily injuries, a cannabis insurance policy is able to step in and cover those costs. Without general liability coverage, the business would be forced to pay thousands of dollars out-of-pocket.
Product Liability For Cannabis Businesses
Product liability coverage protects businesses against injuries and damages caused by the products they create. These cases can be brought by individuals or by groups in the form of class action lawsuits.
Despite cannabis being a relatively safe substance, the chances of product liability issues arising are higher than in other industries. Legal cannabis is a recent development and appropriate use may be new to many customers, so the industry is bracing itself for issues regarding product liability. Product liability covers all legal costs, settlements and medical costs arising from product liability lawsuits.
Although many businesses may believe the chances of such a case arising are low, studies show that claims have already been initiated against growers. Reasons range from the presence of pesticides in the product to injuries caused by inhaling excessive amounts of cannabis. It is, therefore, essential for businesses to ensure their cannabis insurance coverage includes product liability protection.
Umbrella Insurance For Cannabis Businesses
Umbrella insurance, also known as excess liability insurance, is a form of protection against legal claims which exceed the financial limits of a standard cannabis insurance policy. The majority of businesses will never need to invoke their umbrella insurance, but it remains essential for cannabis businesses to have.
An umbrella insurance policy is only activated when the limits of the primary policy have been exceeded. This policy should be included for growing companies running a large risk of a major loss. Coverage limits typically begin at $1,000,000.
Ifa business does not have umbrella liability coverage, any costs that exceed the limits of their primary policy must be paid out-of-pocket.
Contact the Cannabis Insurance Experts at MFE
Insurance is necessary to cover every potential risk in a business, and the cannabis industry is no exception. Taking out a comprehensive cannabis insurance policy can defend businesses against losses from a natural disaster, equipment breakdown or a major accident.
Since the cannabis industry is ever-growing, the risk is perceived to be higher than in other industries. Talk to the cannabis insurance experts at MFE Insurance to find out more about the type of coverage you should take out. Reach out by phone at 213-266-7990 to get started today.