Cannabis Insurance
in Georgia
The state of Georgia has strict restrictions on any aspect of the cannabis industry, and medical use has only been allowed since 2015, with tincture oil as the leading reason. Being insured is a great idea to keep your business safe when the regulations are stricter than in other states.
Understanding the Georgia Cannabis Industry
Georgia became the 37th US state to legalize medicinal marijuana in September 2021. However, the legislation only allows for a few medical problems to be treated with cannabis oil that has low THC levels.
Recreational marijuana use is still banned in the state, and possession is still prohibited.
Six businesses have been granted licenses by the commission to grow and sell medicinal oil made from cannabis in the state. This has created chances for investors and owners of businesses to enter the market and provide consumers with high-quality medicinal marijuana products.
Overall, there is plenty of room for investment and expansion in the Georgia cannabis business, especially in the medicinal and hemp markets. The sector might provide the state several financial and health benefits with the correct regulatory environment and assistance.
Overview of Georgia's Cannabis Market
The Georgia cannabis market has shown great potential for growth despite the regulations. The number of people registering for the medicinal cannabis program has continuously risen every year.
The Georgia Access to Medical Cannabis Commission, the organization in charge of regulating the state’s medicinal cannabis program, had more than 18,000 patients on file as of 2021.
By 2022, about 25,000 people had obtained doctor’s clearance and been added to a state registry.
Following approval of the regulations controlling the state’s low-THC marijuana oil program by state officials, legal medicinal marijuana sales in Georgia may start before the end of 2023.
The first growers may start operating in the spring of 2023 under a set of standards that the Georgia Access to Medical Cannabis Commission passed in March, and dispensaries might begin operating approximately six to eight months later.
Georgia Cannabis Laws and Regulations
Marijuana usage for recreational purposes is prohibited, and being in possession of marijuana may result in penalties and jail time.
Only low-THC oil from cannabis is permitted for medicinal use in Georgia, and patients need a written recommendation from a licensed doctor to qualify for a medical marijuana card.
In 2015, Georgia law permitted a very small quantity of medicinal marijuana usage under certain circumstances, including the ability to own and consume up to 20 ounces of hemp oil containing 5% THC. Possession of an ounce of marijuana is a misdemeanor punishable by up to a year in prison and a $1,000 fine.
A term of 1 to 10 years in jail and a fine of $5,000 is imposed as part of the punishment for having marijuana in whatever quantity to distribute. The penalties range from 1 to 10 years in prison and a $5,000 fine if investigators can show that you provided or made a sale of marijuana, even if it was just a little quantity of up to 10 lbs.
In 2019, Georgia law permitted farmers to cultivate hemp or other cannabis varieties used to produce CBD oils and other state-approved goods, including small amounts of medical THC cannabis oil.
Hash or marijuana extracts cannot be sold, together with cannabis leaves or cigarettes. Hash or concentrate possession is punishable by a $5,000 fine and a prison sentence of one to three years.
Risks Faced by Cannabis Businesses in Georgia
The use of marijuana for recreational purposes is prohibited in the state; however, there is a small medicinal marijuana program. As a result, the state’s cannabis industry has a smaller market.
Although hemp is legal, firms must adhere to rules and testing criteria. Legal and financial repercussions for noncompliance might be severe.
The state may grant four additional Class 2 licenses, each with a $100,000 application fee, in addition to the two current license holders. But that won’t happen until the cases brought by MMJ businesses that were denied licenses against the Georgia Access to Medical Cannabis Commission are settled.
Georgia has not yet legalized the cultivation of medicinal marijuana, but the Georgia Access to Medicinal Cannabis Commission, the recipients of licenses, and the Office of State Administrative Hearings definitely seem to be sowing a lot of distrust.
The Georgia cannabis market has shown great potential for growth despite the regulations. The number of people registering for the medicinal cannabis program has continuously risen every year.
The Georgia Access to Medical Cannabis Commission, the organization in charge of regulating the state’s medicinal cannabis program, had more than 18,000 patients on file as of 2021.
By 2022, about 25,000 people had obtained doctor’s clearance and been added to a state registry.
Following approval of the regulations controlling the state’s low-THC marijuana oil program by state officials, legal medicinal marijuana sales in Georgia may start before the end of 2023.
The first growers may start operating in the spring of 2023 under a set of standards that the Georgia Access to Medical Cannabis Commission passed in March, and dispensaries might begin operating approximately six to eight months later.
Marijuana usage for recreational purposes is prohibited, and being in possession of marijuana may result in penalties and jail time.
Only low-THC oil from cannabis is permitted for medicinal use in Georgia, and patients need a written recommendation from a licensed doctor to qualify for a medical marijuana card.
In 2015, Georgia law permitted a very small quantity of medicinal marijuana usage under certain circumstances, including the ability to own and consume up to 20 ounces of hemp oil containing 5% THC. Possession of an ounce of marijuana is a misdemeanor punishable by up to a year in prison and a $1,000 fine.
A term of 1 to 10 years in jail and a fine of $5,000 is imposed as part of the punishment for having marijuana in whatever quantity to distribute. The penalties range from 1 to 10 years in prison and a $5,000 fine if investigators can show that you provided or made a sale of marijuana, even if it was just a little quantity of up to 10 lbs.
In 2019, Georgia law permitted farmers to cultivate hemp or other cannabis varieties used to produce CBD oils and other state-approved goods, including small amounts of medical THC cannabis oil.
Hash or marijuana extracts cannot be sold, together with cannabis leaves or cigarettes. Hash or concentrate possession is punishable by a $5,000 fine and a prison sentence of one to three years.
The use of marijuana for recreational purposes is prohibited in the state; however, there is a small medicinal marijuana program. As a result, the state’s cannabis industry has a smaller market.
Although hemp is legal, firms must adhere to rules and testing criteria. Legal and financial repercussions for noncompliance might be severe.
The state may grant four additional Class 2 licenses, each with a $100,000 application fee, in addition to the two current license holders. But that won’t happen until the cases brought by MMJ businesses that were denied licenses against the Georgia Access to Medical Cannabis Commission are settled.
Georgia has not yet legalized the cultivation of medicinal marijuana, but the Georgia Access to Medicinal Cannabis Commission, the recipients of licenses, and the Office of State Administrative Hearings definitely seem to be sowing a lot of distrust.
Types of Cannabis Insurance Coverage in Georgia
There is a wide variety of plans to choose from when it comes to you and your business. Some of these include:
Dispensary Insurance
Several risks specific to cannabis dispensaries can significantly affect the operations, due to which the state may require you to get comprehensive insurance coverage before issuing you a valid cannabis dispensary license.
Product Liability Insurance
Cannabis companies that offer tangible products or services risk third-party lawsuits claiming bodily injury or property damage. Products liability insurance covers defense fees and settlements, even for ungrounded claims. This coverage is particularly critical in the cannabis space as testing and manufacturing aren’t regulated at the federal level.
Property Insurance
Property Insurance is a first-party insurance policy, reimbursing cannabis companies for direct property loss (i.e., vandalism, fire, or natural disaster). This policy covers real property, business personal property, and cannabis inventory.
D&O Insurance
Shareholders, competitors, investors, etc., can sue a cannabis company’s executives, putting their personal assets at stake. Directors and officers (D&O) insurance protects these assets from lawsuits alleging leaders of wrongful acts managing the business.
Workers’ Compensation Insurance
Employers are typically responsible for their medical costs and lost wages when employees sustain work-related injuries. This policy covers these expenses, protecting employees while simultaneously keeping cannabis companies running smoothly
Crime
Whether employees steal from you, a thief robs your armored car, or you receive a forged check or fraudulent wire transaction, money theft happens in many ways. Crime insurance guards your cannabis company against damages from these particular crimes.
Several risks specific to cannabis dispensaries can significantly affect the operations, due to which the state may require you to get comprehensive insurance coverage before issuing you a valid cannabis dispensary license.
Cannabis companies that offer tangible products or services risk third-party lawsuits claiming bodily injury or property damage. Products liability insurance covers defense fees and settlements, even for ungrounded claims. This coverage is particularly critical in the cannabis space as testing and manufacturing aren’t regulated at the federal level.
Property Insurance is a first-party insurance policy, reimbursing cannabis companies for direct property loss (i.e., vandalism, fire, or natural disaster). This policy covers real property, business personal property, and cannabis inventory.
Shareholders, competitors, investors, etc., can sue a cannabis company’s executives, putting their personal assets at stake. Directors and officers (D&O) insurance protects these assets from lawsuits alleging leaders of wrongful acts managing the business.
Employers are typically responsible for their medical costs and lost wages when employees sustain work-related injuries. This policy covers these expenses, protecting employees while simultaneously keeping cannabis companies running smoothly
Whether employees steal from you, a thief robs your armored car, or you receive a forged check or fraudulent wire transaction, money theft happens in many ways. Crime insurance guards your cannabis company against damages from these particular crimes.
Choosing the Right Cannabis Insurance Policy in Georgia
Following and understanding these regulations to ensure your business’s success is one of our missions.Following and understanding these regulations to ensure your business’s success is one of our missions.
You are protecting your business from workplace issues, general liabilities, overall insurance concerns, and state regulations.
Working with an Experienced Cannabis Insurance Broker
AlphaRoot
AlphaRoot is a full service insurance brokerage that focuses exclusively in the cannabis, hemp, CBD, holistic medicine and psychedelic industries. We work with companies across the entire supply chain, from seed to sale, as well as, ancillary and capital providers. Our team is heavily invested in these industries and our goal is to help companies scale to propel them forward.
Factors to Consider When Choosing Cannabis Insurance
An insurance broker is responsible for different tasks. Hiring the wrong cannabis insurance broker will waste both your time and money. The right cannabis insurance broker will understand your values and bring the right solution to you. When looking for a reliable broker, there are some essential things to consider.
- Familiarity with this fluctuating cannabis industry.
- Do they offer risk management resources?
- Know their broker expertise.
- How many insurance carriers do they carry
- Can the broker analyze your contracts and advise you?
- You can add or ask for other things depending on your business’s status.
Common Mistakes to Avoid When Buying Cannabis Insurance
They don't purchase insurance at all
One of the biggest mistakes cannabis business owners are making is not having a policy at all. While the wrong policy is problematic, not having any coverage can be devastating to a new or even an established business. Investing in insurance covers the unforeseen and mitigates risk.
They don’t purchase cannabis specific insurance
Cannabis insurance is a very specialized niche in the insurance industry. Not all insurance agents/brokers have specific knowledge about the risks in the cannabis industry. Insuring cannabis is not like insuring your house or automobile strictly because of the nature of what you’re trying to insure and how it’s viewed by the government. If you don’t have a policy that is specific to cannabis, there may be certain exclusions based on the Schedule I status of cannabis or illegal substances.
They don’t work closely enough with a cannabis insurance specialist
Working closely with someone that knows the cannabis insurance industry is critical when choosing a policy. Cannabis business owners have to ask their agents/brokers questions, lots of questions and the broker/agent needs to be able to answer those questions.
Cultivators fail to buy crop insurance
If you are a cultivator or a grower, you rely on your cannabis crop for your income. Cannabis is agriculture, just like corn, wheat, or soy. Cultivators have to protect their income; therefore, they must have cannabis insurance and, specifically, crop insurance. Every year, wildfires ravage thousands of acres of land and crops, resulting in millions of dollars of losses for cultivators.
They don’t know what's included in their policy
As a cannabis business owner, knowledge is power. You have to be aware of the changing laws at the federal, state, and local level. You also need to know your business inside and out. Part of knowing your business is understanding what is and is not in your insurance policy. You have to know what is covered and what is excluded. There are many cannabis specific exclusions that are often overlooked. https://www.s2sinsure.com/post/cannabis-insurance-top-5-mistakes-to-avoid
Benefits of Cannabis Insurance for Georgia Businesses
AlphaRoot is licensed to provide cannabis insurance coverage throughout Georgia, not to mention across the entire US.
AlphaRoot is not in the insurance business. We’re in the business of guiding cannabis companies through the unique risks of our industry. It’s why we don’t merely broker insurance, we curate powerful cannabis risk management solutions.
Insurers looking to provide commercial cannabis insurance to this budding market should understand its rapidly shifting landscape. They must contend with legal uncertainty, evolving regulations, lack of data, and developing business practices. Insurers will also need to understand how the cannabis industry’s first and third‐party coverage needs are unique from other industries.
The website for Georgia’s marijuana legislation outlines how severe the penalties and legal repercussions under the state’s laws are, so you need an excellent marijuana insurance company to represent you.
- MSO’s
- Dispensaries
- Lab Testing
- Cultivation
- Investment Funds
- Manufacturing
- Distribution
- Technology
- Psychedelics
- Brands Service
- Providers
Cannabis Businesses
That May Need Insurance
Getting a Quote for Cannabis Insurance in Georgia
Cannabis Insurance in Georgia
Frequently Asked Questions
Apart from the basic coverage for property damage, theft, product liability, and general liability, some cannabis insurance plans also include worker’s compensation, wage loss, and online liability coverage.
It’s essential for cannabis companies to carefully review their insurance agreements to ensure they have adequate coverage for their unique requirements. So, if you’re running a cannabis-related business, take the time to understand your insurance coverage and make sure it meets your specific needs.
The cost of insurance for cannabis-related businesses can vary widely, ranging from hundreds to thousands of dollars, depending on the size and specific needs of the business. Due to the nature of the industry, cannabis companies face unique risks, which can impact insurance costs.
There are no current laws in Georgia that require cannabis-related businesses to carry insurance. However, it’s important to note that having insurance is highly recommended for any business, especially those in the cannabis industry of Georgia as the laws and regulations are very narrow and strict.
Contact your insurance provider as soon as possible after the incident or loss. They’ll guide you through the claims process and provide you with the necessary forms and documentation to fill out.
It’s important to be as detailed as possible when filing a claim, including the date and time of the incident, a comprehensive description of the damage or loss, and any supporting documentation you can provide. Your insurance provider will then assess the claim and determine if it’s covered under your policy.