There are generally a couple of routes marijuana establishments take to getting insured; owners may use insurance companies that specifically cater to the cannabis industry or, alternatively, they may secure insurance through more traditional insurers willing to carry the risk. Some companies may also choose to self-insure, but that is relatively rare.
Popular Marijuana Insurance Companies
Big name cannabis insurers include OG Cannabis Insurance and Cannasure. Cannasure is a popular cannabis-based insurance company used by many of the marijuana establishments in Nevada. Unfortunately, premiums remain high compared to other industries.
Insurance Requirements for Marijuana Businesses
In terms of insurance coverage, dispensaries are largely treated the same as any other business. Pursuant to state law, dispensaries are required to carry certain types of insurance. In Nevada, businesses MUST be covered for premises liability and worker’s compensation. Additionally, all businesses with at least one employee are required to carry worker’s compensation insurance. Worker’s compensation insurance serves the purpose of covering employees that are injured or become ill during the course of employment. Nevada is a no-fault insurance state, which means that workers will be covered regardless of how the injury was caused, as long as it occurred at work. Failure to carry worker’s compensation can result in severe legal penalties.
Legal Issues with Insuring Marijuana Establishments
Despite the fact that marijuana is illegal at the federal level, marijuana establishments are still able to get insurance. Unlike banking (which poses different challenges), there are no restrictions when it comes to marijuana businesses being insured. When it comes to paying insurance companies, however, marijuana establishments may be stuck dealing only in cash. Therefore, businesses will likely need to make payments using money orders (similar to the way some establishments pay for utility bills).
It is likely that private insurers would also cover lounges (should they become legal at some point) the same as they do other marijuana businesses. Because a lounge is still considered a business, they would be required to carry insurance pursuant to state law, such as premises and worker’s compensation.
Marijuana Lounges and Insurance
Consumption lounges have yet to be implemented by states, therefore it is unknown which companies in particular would insure them and the exact cost of doing so. Lounges would require similar protections as other marijuana establishments in terms of employees, product coverage, and property coverage. As with all insurance companies, they would be required to determine the risk involved with the particular industry and establishment looking for coverage, in addition to the consideration of dram shop liability.