What Insurance Do You Need When Operating a Cannabis Dispensary?


Business owners choose insurance policies according to the type of business. A cannabis dispensary provides medicinal products that improve health and address a variety of medical concerns. When selling cannabis to consumers, the business owner must follow federal regulations and state laws. This means that we must follow steps to prevent certain liabilities. The owner must also consider ways that their assets could become damaged, or they could suffer a financial loss. Reviewing options for protecting their assets properly shows cannabis business owners what insurance policies are most helpful for them.

Commercial Property Insurance

Commercial property insurance provides financial assistance if the commercial property is damaged or classified as a total loss after a covered event. The property owner receives the market value of the property if it is a total loss, and the owner has the choice between rebuilding or buying another property. The owner files a claim whenever they sustain property damage, and the policy provides funds to pay a repair service. The policies may also provide payment for remediation services after flooding, water leaks, or fires. Cannabis growers can find out more about insuring your dispensary by contacting an insurer now.

Worker’s Compensation Coverage

All employers are required to purchase worker’s compensation if they have more than one employee. The law applies to everyone including workers that are related to the owner. The insurance provides payment for the worker’s medical expenses for their work-related injury, and they receive wage replacement if they cannot return to work immediately.

The employer must start a claim for the work-related injury as soon as it is reported to them. The worker has up to thirty days to report the injury to their immediate supervisor. The human resources manager must send the injured worker to the emergency room. The medical report must arrive at the insurer’s office within 10 days. The claims adjuster reviews the worker’s claim and determines if the worker is eligible for benefits. The workers receive compensation through the insurance provider if they are eligible.

The employer must follow all OSHA regulations for keeping the property safer for all workers. If the worker was injured because of an OSHA violation, the employer could face a financial penalty for their failures. If the insurer denies the insurance claim, the worker may file a lawsuit through an attorney.

General Liability Coverage

General liability insurance protects the company against financial losses if they cause property damage, visitor injuries, or a breach of contract. The policy pays compensation to the client or claimant if the business owner loses a lawsuit. The business owners file a claim when a legal claim is made against the company, and the primary purpose of the policy is to prevent a financial loss that might shut down the business or bankrupt them.

Insurance for Their Crop

Insurance coverage for the cannabis crop protects the dispensary’s crops. If the crops are damaged, the business experiences a significant financial loss. The insurance provides funds when the business loses its crop and does not have products to sell to their customers. The insurance may provide help with equipment used to cultivate the crops and for keeping them healthy. The dispensary will also need equipment to manage climate control during colder months that may lead to crop loss. If the business owner loses a portion of their crops for any reason, they can start a claim through their insurer and collect the funds they need to offset their losses.

Product Liability Coverage

Product liabilities present a risk to the cannabis dispensary if a consumer becomes injured while using their products. They must follow all regulations when creating their cannabis products and ensure that they are safe for consumer usage, and the products must be inspected according to regulations. When packaging the cannabis products, the dispensary must present vital details about the products and offer guidance for using them. The dispensary owner will face serious liabilities if a customer becomes ill or sustains injuries while or after using the products, and the consumers may file a lawsuit against the dispensary owner. The insurance coverage helps the business owner mitigate a risk associated with product liability claims.

Loss of Income Coverage

Loss of income coverage helps cannabis dispensary owners get funds when they cannot operate their business, and the funds cover the cost of expenses and paying their workers. They can file a claim through the insurer and get funds to keep their business afloat during emergencies such as a global pandemic. When they are unable to generate funds through their business, the funds make it possible for them to avoid bankruptcy if they have existing debts. The funds are available at any time, and the terms of the policy show how much they can get at a time.

Riders for Theft of the Crop

Adding riders for the inventory reduces the potential for losses if someone breaks into the physical location and steals their inventory. Dispensary owners need additional protection for their crops based on the official value of the full inventory. With a rider, the crops are appraised by a licensed appraiser, and the rider shows the exact price for the products. If they are lost, damaged, or stolen the dispensary owner gets the exact price of the crops according to how much was lost, damaged, or stolen. Adding a rider gives the owner extra protection against financial losses.

Cannabis dispensaries and distribution centres need proper insurance coverage to protect them against a variety of circumstances that generate financial losses. When it comes to selling cannabis products, the business owner must consider what losses they face if the crop is damaged or stolen. They must consider what will happen if their product is contaminated, and customer sustains injuries. The property used for the dispensary must be protected to prevent a financial loss. When the business cannot operate their company for circumstances that are beyond their control, they need a policy that replaces the income or profits. Reviewing policy options for a cannabis dispensary shows the owner the best ways to protect their investments.

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