Cannabis businesses in weed-friendly states like California continue to thrive, especially when under sound business management. However, they still face many of the legal and financial risks that can threaten any business.
There are many ways to limit your business risk, such as understanding your obligations as an employer. Putting the right insurance policies in place may be another way to prevent problems that could jeopardize your operations.
Some insurance is mandatory
California cannabis businesses must maintain commercial general liability insurance from a provider authorized to do business in the state. Your general liability policy can guard against financial loss if you are found liable for another’s injuries or damages.
Nearly all employers must also obtain workers’ compensation insurance to address employee injuries and comply with state law.
Other insurance options or policies to consider
Those who own and operate a business involving marijuana need as much protection as possible. Depending on your specific field, these insurance policies can safeguard your interests even more.
- Crop insurance, especially for commercial growers
- Product liability insurance for businesses that manufacture or sell cannabis products (edibles, cartridges, creams, etc.)
- Property insurance to mitigate losses arising from fire, theft and other adverse events
If transportation is a large part of your operations, commercial auto insurance can protect you from product loss in an accident. It can also safeguard your interests if someone harmed in the crash seeks personal injury and property damages.
As you can see, the right insurance policies combined with sound business practices can reduce your risks. Guidance from a legal representative can help you identify all threats to your company and take appropriate steps to address them.