Cannabis Laboratory Insurance

General liability insurance, or “all-risk” coverage, helps you protect your business against potential risks. This includes any claim arising from a harmful incident that took place within your cannabis lab premises.

But do you really need it? Suppose your routine vendor was busy doing his usual work at the facility before he got hurt and sustained a bodily injury. Who pays for his medical expenses?

Take another instance. Your competitor believes you plagiarized or defamed them and chose to sue you for that. Such claims affect both your financial and reputational well-being.

General liability safeguards your business from third-party claims, protects your customers from any personal property damage or bodily injury, and secures your assets against legal obligations.

Cannabis dispensaries sell tangible CBD products that can constantly be subjected to product liability claims. This puts dispensaries in a constant risky state, making product liability coverage a must-have for every testing facility owner.

Since testing and manufacturing aren’t legalized in a federal state, there’s no way a cannabis business can be 100% safe from product liability claims.

The limitation on marketing and advertising of cannabis products can be a massive reason for misinterpreted expectations on the consumer’s end. This gives rise to product liability claims where substandard products aren’t customers’ concerns, but the effects are.

Product liability insurance covers all medical costs, settlement costs, and defense fees, even when the claims are ungrounded. It enhances your credibility and shows that you care about your customers.

As discussed, the cannabis industry is operating in a cash-intensive environment. The environment, combined with the value of premium cannabis products makes cannabis dispensaries prone to thefts, forgery, employee dishonesty, etc.

Crime insurance protects your cannabis laboratory business against all financial losses in cases of theft, employee dishonesty, forgery, and other fraudulent activities. It provides coverage for stolen cash, inventory, and property damage resulting from criminal acts while ensuring your business can recover from financial setbacks.

In several states where the crime rate is high, crime insurance could be a basic coverage every cannabis laboratory owner must purchase to strengthen their risk management plan.

Regardless of the fact that you own or rent a cannabis laboratory, it is indeed a huge asset. Nobody wants their valued property and assets to disappear into thin air because of unforeseen circumstances.

No property is immune to natural disasters, regardless of the technology you use to build it. Plus, a fire breakout owing to an equipment failure could also severely affect your cannabis labs.

In such cases, there’s no telling if it’s only your property that faces the wrath or also your inventory. For dispensaries, such incidents could turn into substantial financial losses, which, without adequate insurance, will be impossible to recover.

Property insurance reimburses for direct personal losses, covers renovation and equipment repairs, and offers compensation for the losses the business faced because of the incident.

The average cost of a data breach as of 2022 was $4.3 million, which explains why 60% of businesses fail within one year of cybersecurity breaches.

Whether a data breach happens because of inadequate cyber security or due to employee’s mistakes, vicious cyber criminals do everything to break a business.

Consequently, third-party lawsuits and fines and penalties from regulatory authorities if private data is stolen elevate financial costs to recover businesses.

Cyber insurance offers forensic investigations, helps with data recovery, covers financial losses, and helps with legal settlements.