Cannabis crop insurance is highly recommended to prevent substantial financial loss if something were to destroy your crops. For businesses within the cannabis industry (especially cannabis growers), the loss of crops is devastating without a reliable insurance policy. Understanding what cannabis crop insurance is, who it is for and how it is beneficial should help you make an informed determination as to whether or not it is right for your business. Outlined below is an in-depth overview of cannabis crop insurance, the types of businesses that require it and what other cannabis insurance policies your organization may require.
What Is Cannabis Crop Insurance?
Cannabis crops are incredibly valuable and take several months to properly grow and harvest. If something were to happen to part or all of your cannabis crops, it could be devastating to your business. Cannabis crop insurance protects you from a financial loss to your cannabis crops. This primarily applies to grow operations. Cannabis crops can be damaged or destroyed under certain weather conditions such as heavy wind, fire and flooding. They are also targets of theft, which crop insurance protects against as well. Additionally, cannabis growers are at risk of losing their crops due to changes in climate that lead to molded, diseased or inadequately fertilized crops.
What Businesses Need Cannabis Crop Insurance?
Anyone who is responsible for the growth of cannabis crops requires cannabis crop insurance. This coverage protects the grower from substantial loss of profits if they were to lose a significant portion of their crops due to poor weather, theft or other unpredictable and uncontrollable circumstances.
Certain other business types within the cannabis industry may also need cannabis crop insurance, including manufacturers, cannabis transporters, retail stores/dispensaries and property managers, particularly if they grow, cultivate or manufacture cannabis products at their place of business. In addition to crop insurance, businesses within the cannabis industry require other types of cannabis insurance policies, detailed below. A cannabis insurance consultant can help you determine your specific policy needs.
The Benefits Of Cannabis Crop Insurance
Cannabis crop insurance is not necessary in most states that allow for the legal sale of cannabis products. However, it is strongly encouraged to have, particularly for cannabis businesses that rely on the successful growth and cultivation of cannabis plants. The most notable benefit of cannabis crop insurance is financial protection. This ensures that if anything were to occur to your cannabis crops that is outside of your business’ control, you would be covered financially for the loss of profit and the replacement cost as you plant new crops.
More generally, cannabis insurance also ensures protection for your employees as well, particularly if your organization starts a workers’ compensation insurance policy. This ensures that your company is able to adequately deal with workers’ compensation if one or more of your employees are injured or fall ill while they are on the job. Most notably, cannabis insurance mitigates the overall risk your business takes on. This provides more financial stability for your business, reducing the risk of a substantial loss of profits that could potentially cripple your business. This also gives you, your company executives, employees and customers peace of mind knowing that you can adequately deal with any financial obstacles that come your way.
Additional Types Of Cannabis Insurance Policies
Depending on your type of business, your organization may need additional cannabis insurance policies as well. The most notable types of cannabis insurance policies to consider include:
- General Liability – This protects you from claims of bodily injury or property damage made by third-parties.
- Product Liability – Product liability coverage protects you in instances wherein one or more of your customers claims they were harmed by the use of your product.
- Excess Liability – Also called umbrella insurance, this coverage protects you from costs that exceed the limits of your primary coverage.
- Equipment Breakdown – If your business relies upon equipment to operate each day (e.g. hydroponic watering systems, heat lamps, industrial fans, computers, etc.), then you need equipment breakdown insurance.
- Cyber Liability – This protects you in the event that a data breach occurs and gains access to privileged company information, such as employee information and customer records.
Of course, there are other types of cannabis insurance policies you may need as well. The best way to determine your needs and put together a custom plan that encompasses all of the policies you need in one plan is to consult with a cannabis insurance consultant.
Start Your Cannabis Crop Insurance Policy With MFE Insurance
To learn more about cannabis insurance and how it benefits your business, contact the experts at MFE Insurance. We work with all types of businesses within the cannabis industry to ensure they are financially protected from risks that are specific to the cannabis industry.