Cannabis Insurance Basics
Business Owner’s Policy:
Typically, each business needs the same basic cannabis insurance policies . Many small businesses buy the same packages of insurance. The most common bundle is the Business Owner’s Policy. The BOP includes Property Insurance, Business Interruption, and Liability insurance.
Protects the business buildings, land and equipment from covered losses.
Commercial General Liability:
It is a broad policy that protects the business from liability claims related to operations, product, premises, and independent contractors. It does not include vehicle liability or any of the business’ assets.
Protects the business from claims arising from products that the business has manufactured or sold. It also protects against claims from any other marijuana infused products that are subsequently sold.
Excess or umbrella insurance increases the amount of coverage for the liability insurance policies.
Growers and farmers purchase crop insurance to protect their business against loss due to natural disasters such as flood, hail, and drought. Crop insurance does not cover over use of pesticides.
Protects the business from loss due to mechanical or electrical failures of equipment.
Provides lost wages and medical cost reimbursement to employees that are injured while performing a job duty. It is a California state requirement.
Bonding is necessary to have proper licensing. The bond ensures that the licensee will adhere to the regulations and guarantee payments related to the costs incurred for the destruction of cannabis goods due to violation of applicable regulations.
Employment Practices Liability:
Protects the company against claims made against the company by employees in regards to employment-related issues such as discrimination (age, race, sex, disability), harassment, and wrongful termination.