Marijuana Insurance Markets Commercial Insurance

Marijuana Insurance Is A Smoky Subject

As marijuana becomes legally usable in more states, the marijuana insurance industry has grown to fit the need.

There’s medicinal use and recreational use; there are dispensaries and there are other growing and selling operations. They need insurance just like everybody else, and the standard insurance market doesn’t want to deal with it. Specialty insurance programs now exist in this area to support the expanding industry.

Marijuana Insurance Coverages

To understand why one must go to a “specialty market” for their marijuana operation, you must first understand the standard market. The “standard market” writes their business voluntarily. An underwriter reviews the risk and decides to offer insurance coverage. They can afford to be picky and dodge higher-risk industries or operations. Companies like Liberty Mutual, Nationwide, Travelers, and Main Street America/National Grange have standard market operations.

An insurance agent usually has “binding authority” with their standard market carriers. Meaning, they can submit and issue certain types of business within the insurance carrier’s appetite. Plumbers, small convenience stores, white-collar offices might be in there.

For the standard market, marijuana insurance is too new and potentially risky. Few, if any, have insurance programs designed to fit this type of need. It may come someday, but that’s years down the track. For now, marijuana dispensaries and others must seek coverage in a speciality market outside the standard realm.

These insurance products are developing quickly. Depending on your state, there are companies that may be able to write your General Liability, Property, Workers’ Compensation, and Umbrella Liability coverages. Among the people who can be covered are vendors, dispensary owners, landlords of dispensaries or growing facilities, and doctors prescribing medical marijuana.

Standard Market vs Excess Surplus Lines

Marijuana Insurance Availability

Of course, if marijuana isn’t legal in your state, that’s a whole other issue. Hopefully, you’re not counting on coverage for your “dispensary” there. You might not want to let too many people know about it, either.

Cannasure, for example, is a specialty market that offers over a dozen lines of business to protect businesses in the marijuana industry. The website Ganjapreneur lists other agents and brokers that have offerings, including Complete Access Insurance and Cannabis Insurance Advisors.

As far as we know, “Ganjapreneur” is not affiliated with Laganja Estranja. I sense a marketing opportunity, though.

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