CBD Insurance
Why Businesses Need CBD Insurance
Every cannabis business should have comprehensive insurance coverage to safeguard their interests. When it comes to crops such as hemp, this can get a little complicated.
Like other farmers, you need assurance that you’ll have something to fall back on in the event of a crop failure. But if you also own a dispensary, there are additional legal issues to consider. How can you make sure you’re covered on all fronts? The answer is: with the proper CBD insurance.
CBD insurance can cover a variety of different insurance coverages depending on your policy. As a hemp grower, here are some of the top coverage types to consider.
Crop Coverage
CBD insurance protects your company from the financial impact of crop loss. This includes natural causes:
- Disease
- Freeze
- Excessive moisture
- Drought
Coverage extends from planting all the way to harvest so you can recover from damages incurred at any point in the season. With the right policy, you can get the resources you need to weather field devastation.
Property Insurance
Like most businesses, hemp growers own critical property, such as greenhouses, storage facilities and extraction labs. Damage to these properties can cause a shutdown of your entire system.
CBD insurance that offers property coverage allows you to address damage from weather, fire and crime in a timely manner, with minimal impact to production. Policies for commercial property are especially important, as they need to be correctly classified according to business type.
Equipment Coverage
Hydroponic and extraction equipment are significant investments, especially if you’re trying to expand your market. If you’re leasing equipment or have taken out a loan for it, any damage can be catastrophic to your bottom line. Appropriate equipment insurance lets you replace necessary items with comparable quality so your product doesn’t suffer in the interim.
Even if you grow hemp using outdoor soil, equipment insurance is crucial. You don’t want to be left scrambling to replace tools and machinery in the middle of a busy season.
Product Liability
Due to the shifting legal stances on the federal, state and local level, product liability is important for businesses at any position in the supply chain. A customer complaint can seriously damage your image, a powerful blow in an industry as competitive as this one. To protect yourself from these risks, there are several areas your CBD insurance should cover.
Legal Disputes
Many states have legalized all forms of hemp, but marijuana remains illegal at the federal level and in many states. While this theoretically shouldn’t affect your CBD products, shipping across state lines can get complicated, especially where classification is concerned. Polices covering legal disputes can ensure that you don’t lose money defending a product due to red tape or clerical errors.
Medical Claims
CBD’s potential to relieve pain and alleviate certain symptoms is a huge part of the market’s recent growth. However, the scientific studies on these matters are currently limited, which means you can land in hot water if you make medical claims in your advertising. Even if you’re careful about your wording, there’s a risk of customers misusing or misunderstanding a product, which can lead to legal issues. The right CBD insurance protects you from shouldering the burden of defending against these legal actions.
Topical and Ingestible Products
No matter your business type, if you produce topical or ingestible products, you need CBD insurance with liability coverage. Like any medicine, some people will experience allergic reactions and have adverse side effects from the use of CBD, and you may be held liable for negative reactions consumers have. The quality of your products isn’t in question — it’s the reaction said products will produce with each individual’s body chemistry. With certain factors out of your control, you need a policy that has your back.
When you need insurance for your hemp crop, HUB International can offer coverage for your crop’s entire lifecycle and tailor policies to your unique needs. For more information or to get a quote, contact us today.