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Being a newly legalized industry with ever-changing regulations, many business owners fall at risk of purchasing either substandard or wrong insurance policies. Cannabis businesses need to juggle between several potential financial risks while mitigating customer claims. Let’s not forget that every business needs to stay in compliance to maintain an operating license.

Did you know that the Cannabis industry is projected to clock the $146.4 billion mark by 2025? What this means is that the US cannabis industry will continue to grow rapidly within the coming years. However, this unprecedented increase brings to light a whole new set of challenges.

If your cannabis business isn’t properly protected, all the above risks can be financially crippling. It is, therefore, paramount for you to understand the unique insurance needs of this volatile industry. You also have to consider the specific needs of your company before picking out the right insurance policies.

Understanding the Challenges of the Cannabis Insurance Industry

All legal cannabis pioneers are facing one massive problem in the insurance industry: the reluctance of traditional insurance companies to offer tailor-made cannabis insurance programs. Most insurers are not keen on entering this new marketplace.

There is a limited number of cannabis insurance offerings in the market. Most business owners have no choice but to settle for ineffective and generic policies. Note that some of these insurance policies will not adequately address the needs of a legal cannabis establishment.

What Type of Insurance Coverage Do I Need?

Every business has its unique set of insurance policies that help transfer and mitigate risk. For your cannabis business, you will have to stick with the following policies: commercial property insurance, product liability, general liability, and workers’ compensation.

Commercial Property Insurance

Almost all business establishments require commercial property insurance coverage. You get proper coverage in case your property gets damaged by natural disaster, theft, or fire. The property will include inventory, equipment, buildings, and personal items. Through commercial property insurance, you can mitigate the loss of income and protect expensive equipment.

Product Liability Coverage

As stated earlier, your cannabis business needs to mitigate customer claims. With product liability coverage, you will not be found liable when a person experiences any side effects after using your product. However, you need to consult with a licensed cannabis insurance broker to find the right product liability coverage that suits your needs.

General Liability Coverage

This is a handy coverage that protects all of your business assets from any claims involving property damage or injury. It is especially vital if you are contracting with third parties or leasing commercial property.

Workers’ Compensation

If you have a cannabis establishment, you will most likely have workers. According to the law, you need to have workers’ compensation to cover all your employees. You can rest assured knowing that all your workers are fully covered, in case of any mishaps or problems.


The lack of specific cannabis insurance policies usually leaves a lot of owners exposed to several risks. Most of the time, you have no choice but to overpay for insurance coverage that you do not necessarily need. However, the policies above can help you keep your business afloat while waiting for the insurance industry to design specialized insurance policies.

At, we can help you secure the proper insurance coverage for your cannabis business. We will also help you get all your documentation in order, thus ensuring that you are compliant with both state and federal law. Ensure you contact us today to help you employ the right strategies to cover your business. With our help, you can avoid legal issues and loss of business in the cannabis industry.