Cannabis products are more popular than ever, and a lot of savvy entrepreneurs are interested in starting or investing in businesses in the sector. There are a lot of reasons why now is an ideal time to get involved, but there are also unique hurdles to overcome when you’re working in the cannabis industry. Insuring your business, in particular, can be tricky if you don’t work with cannabis insurance programs. However, finding the right coverage is simple if you know where to look. Keep reading to learn more about why your cannabis business needs insurance.
Why does your cannabis business need insurance?
Obtaining insurance can be a challenge for cannabis businesses, but you should never go without it. Generally, all businesses need insurance to cover the costs associated with issues like product liability and property damage. There are multiple lines of insurance to consider, each of which addresses different issues. General liability and property insurance are must-haves, especially for a retail business, but you should also look into guarding yourself against other threats. Cyber and data breach coverage, for example, can be extremely beneficial for businesses that operate partially or exclusively online.
Fortunately for those in the industry, you can find cannabis insurance solutions that protect your business. There are insurance policies available for almost every kind of cannabis company. Cannabis insurance policies cover businesses in medical and life science, construction, and even agriculture. If you’re not sure what insurance coverage you need, it’s a good idea to talk with a cannabis insurance professional to learn more about your options.
Is now a good time to go into the cannabis industry?
Now that the sale of CBD has been legalized on a federal level through the passage of the 2018 Farm Bill, and marijuana legalization is gaining momentum all over the country, cannabis is more popular than it’s ever been. The CBD market, even though it’s only been around for a few short years, is already projected to be worth over $20 billion by 2024. Dispensaries are bringing in massive profits and generating substantial tax revenue for states that have allowed medical or recreational cannabis programs. If you’re considering getting into the business, now is a perfect time.
The legal landscape depends on what type of cannabis products you sell. CBD is often a better idea for first-time cannabis business owners, as it’s federally legal and products are available in all 50 states. Since THC is still considered a controlled substance by the federal government, you can only operate a marijuana business in states that have legalized marijuana for medical or recreational purposes. Currently, there are 36 states with medical marijuana programs and 16 states that allow recreational use. There are many bills and ballot measures being considered, so those numbers are likely to grow in the coming years.
Make sure you remind your customers that if they haven’t used cannabis before, they should consult their doctors before trying it for the first time. Their doctors will be able to tell them how cannabis can affect any health conditions they have or interact with medications they’re currently prescribed.
Starting a business in the cannabis industry can present some logistical challenges, but acquiring insurance has gotten less difficult in recent years. You can even find insurance providers that work exclusively with cannabis companies. If you’ve never owned a business before or you’re new to working in the cannabis world, take the time to research which lines of insurance your business needs. Having insurance is the best and most effective way to ensure that your business can cover the costs in the case of an emergency, whether it be an issue with product liability or that your storefront has incurred property damage. If you have any questions, you can ask a broker to walk you through the advantages and drawbacks before you commit to a specific policy.