Cannabis insurance is not offered as one single policy. Instead, cannabis business owners will typically need a group of policies designed to cover their specific operations. These could include:

• Crop Insurance
• Workers Comp Insurance
• Cargo Insurance
• Cyber Insurance
• Director’s & Officers Insurance

And that’s just a partial list. Our clients frequently ask us, “what is the most important insurance coverage I need for my cannabis business?” So we thought we’d share the answer with you in this quick post.
Commercial General Liability Insurance For Cannabis Businesses
The most essential coverage you’ll need for most any type of cannabis business is a general liability policy. General liability should be your first order of business, whether you are a lab, cultivator, dispensary, or other cannabis operation. General liability insurance coverage will protect you from numerous potential claims, including property damage, bodily injury, and much more. 

If your state doesn’t require you to carry general liability insurance, it can be tempting to skip the expense of this vital coverage. Yet it’s not a wise idea for your business. That’s because one simple lawsuit could easily eat up all your financial resources and take you and your business down with it. 

Why Should Your Cannabis Business Have Commercial General Liability Insurance?

Every business naturally goes through ups and downs. When you’re starting out, it may seem like the sky’s the limit. But what if someone gets hurt at your business? Or what if there is damage to someone else’s property? If you (or your employees) have any face-to-face interaction with customers, you’ll need general liability.

What Will Cannabis General Liability Insurance Cover?

Property Damage
Nobody intentionally causes damage to someone else’s property, yet it happens daily. If you or one of your employees accidentally damages a customer’s property, you will likely be held responsible. Mending the damage can be simple, or it can get very complicated, incurring huge and unexpected expenses quickly. A general liability policy will protect you from accidents both large and small. 

Bodily Injury
You can take every possible precaution, and still, injuries can happen. So you need to be ready for the worst, from twisted ankles to more severe injuries. General liability not only protects you against a costly lawsuit, but it’s also the right thing to do for your customers and employees.

Medical Expenses
If a customer does end up getting injured at your cannabis business, they will most likely have medical expenses that can cost thousands of dollars—or more. Even a minor injury can be costly. But a more serious one can have catastrophic financial consequences for your business. You can protect against this possibility with a cannabis general liability policy.

Legal Fees
Cannabis is a new industry operating in unchartered waters. As such, all cannabis business owners are in a position of legal risk. What if a customer files a lawsuit against your business? Can you afford to hire a good attorney? General liability can cover the cost of obtaining a lawyer and may even help with settlement funds.
Product Liability and Operational Costs
Some general liability insurance policies also cover operational costs, product liability, or both.

Product Liability
If you distribute products in any form, you’re vulnerable if someone claims your product caused them harm. For example, someone could argue that your buds were moldy, making them sick. However, if product liability coverage is part of your general liability policy, you’ll be covered for these claims. 

Operational Costs
There are dozens of different cannabis businesses, each with its own production methods and processes. If an employee is injured while processing your products or harvesting your plants, you could be responsible for medical and legal costs. You may even have to compensate them for the time they are out of work. Your cannabis general liability policy may include coverage for operational costs.

What Does Cannabis General Liability Insurance NOT Cover?

Understanding your risks is essential to obtaining the best insurance coverage for your cannabis business. Unfortunately, many business owners falsely assume they are covered for any inevitability through their general liability policy. Often, they don’t discover this error until something bad happens.
So there are several areas where your enterprise may need additional coverage. Some options that are usually not included in your general liability policy include:

• Crop and inventory coverage
• Commercial auto insurance
• Employee theft
• Cyber threats
• Equipment breakdown
• Workers comp
• Loss of income
• Employment practices liability insurance (EPL)
• Excess liability 
• Crime insurance

Closing Thoughts

The cannabis industry is growing fast, and there’s a lot of money to be made. But there are still conflicting federal and state laws that govern the sale of the nation’s latest cash crop. Because of this tangled web of red tape, obtaining cannabis insurance for your business can be difficult. We aim to make it easier. 
Our specialists at GreenCore can help you identify the risks your specific cannabis business faces. Then, we can get to work on tailoring a personalized plan that delivers the exact coverage you need. That way, you can focus on growing your business. Reach out today!