Embroker’s Cannabis Practice
Why Your Cannabis Company Needs Coverage
The marijuana industry is projected to grow to $146.4 billion by 2025. As the industry grows and becomes more regulated, it will become increasingly more difficult for businesses to avoid risk exposure.
Additionally, there are unique risks that cannabis businesses face. A minor problem can result in an expensive lawsuit or result in a loss of your business license. The legal status of medical and recreational marijuana is in constant flux and varies wildly from state to state, creating a legal minefield that the right insurance coverage can help you traverse.
Highly-Publicized Examples of Insurance at Work for Cannabis Companies
- A Carpinteria farmer won an insurance payout well in excess of $1 million after ashes from the Thomas Fire destroyed thousands of his marijuana plants. See: California cannabis company receives historic $1 million insurance payout following fire
- One of the biggest names in cannabis retail, California-based MedMen, faced a potential class-action lawsuit from former employees that alleged multiple labor law violations. See: Marijuana retailer MedMen facing potential class action lawsuit from former employees
- A Boulder-based cannabis-infused edibles manufacturer voluntarily initiated a state-wide recall on one of its products because of “a lack of temperature control during the manufacturing and distribution processes.” See: Colorado edibles company recalls MaryMint Tincture after inspection
- AltMed, a medical marijuana provider in Florida, warned customers of a data breach involving its website. Confidential customer information was accessible through their website search function, exposing data from thousands of their customers. See: Medical marijuana company warns of data breach
Cannabis Insurance Costs
When applying for insurance, there are many factors that carriers take into consideration while underwriting new coverage. Cost drivers will always be different based on the policy type, limits needed, and stage of the business. Working with the right partner will ensure they are not only negotiating the right coverage but the best possible pricing options for your company.
Additionally, cannabis startups are unique in the eyes of underwriters because their growth tends to outperform the expectations associated with more traditional startups.
Now that you have a better understanding of insurance for cannabis and hemp companies, you may be wondering how all of this affects your business and where to go from here. If you need more help or information, you can reach out to our team of expert brokers. If you prefer to get started on intelligent quotes, create your Embroker account today.
Cannabis companies require unique insuring expertise and experience. Our Cannabis Practice team is redefining the way cannabis companies purchase insurance, combining technology with deep insurance expertise and genuine understanding and care for your business.
Embroker is the easiest way to intelligently insure any business. We’re here to help!