Cannabis Insurance

What You Need to Know About Cannabis Insurance

The cannabis industry is ever-growing in Ontario, with new businesses popping up what feels like every week. As a newer industry, there are many variables and risks for business owners to tackle, putting them at risk of having the wrong insurance policies in place or not enough coverage to protect their business. Therefore, between the financial risks and possible liability claims, cannabis business owners must have cannabis insurance in place. 

Insurance Coverage Options

Purchasing cannabis insurance in Ontario is effortless when you work with one of our Insurance Heroes. Our team works to understand your requirements by asking the right questions and ensuring you receive high-quality, comprehensive coverage for your business. Because we partner with leading insurance companies across Canada, you can trust us to find you the best coverage at the best price.

What is cannabis insurance?

Cannabis insurance is designed for businesses that operate within the cannabis industry to protect their businesses and assets. As with any business, small or large, there are many associated legal and financial risks. From property damage to stolen products to product liability and more, cannabis business owners need insurance policies in place to safeguard themselves from these risks. 

What does cannabis insurance cover?

While cannabis insurance is similar to commercial business insurance, not all policies are the same, as businesses within the cannabis industry vastly vary. When operating a cannabis business in Ontario, business owners should have peace of mind that their insurance policy will protect them from anything they may face. Here at Insurance Hero, we are ready to provide the following insurance policies for cannabis business owners: 

Cannabis Liability Insurance

Cannabis liability insurance covers associated legal fees and medical expenses due to various risks, including:

    • Commercial General Liability: Commercial general protects you, your business and your employees from legal liability against claims of bodily injury that occurs while at your place of business to staff, guests, suppliers or customers. It also covers any third-party property damage that occurs while an employee is visiting a customer’s property, such as a delivery driver.
    • Product Liability and Product Recall: As cannabis is an organic drug, it can cause expected side effects in users, such as heart attacks, seizures, stroke and cardiac arrest. This policy protects you against any claims of bodily injury due to your product.
    • Reputation Risk: In the event of any negative press or public image issues, this policy protects your business from libel, slander or copyright infringement by covering any associated costs or losses.
    • Cyber and Privacy Liability: Cyber and privacy liability insurance protects your business by covering damages and legal claims if your customers’ personal information is leaked or stolen due to a data breach or theft.
  • Errors and Omission (E&O): E&O insurance is professional liability insurance that protects your business and employees against the full cost of customer claims of negligence or inadequate work. It covers:
  • Errors, mistakes and oversights
  • Failure to meet deadlines
  • Failure to deliver your product to a customer
  • Professional negligence
  • Failure to meet a standard of care
  • Breach of contract

Any business that provides a service requires an E&O insurance policy. 

Commercial Property Insurance

Commercial property insurance protects your brick-and-mortar business and the contents inside from such perils as:

  • Property damage due to natural disasters, flood, fire, vandalism or theft.
  • Property damage or theft of electronics, equipment, company documents or employees’ personal belongings, as well as outdoor fixtures such as landscaping, fencing, signs, etc.
  • Spoilage of products or inventory theft by employees.

It can also include business interruption insurance should you have to temporarily shut down your business or be unable to work due to an illness or injury. Business interruption coverage will help offset any ongoing costs from income losses, such as bills, employee wages, etc.

Commercial Auto Insurance

If you have cars that are used by yourself or employees for work-related purposes, such as transportation or delivery of products, you need commercial auto insurance, as personal auto insurance will not cover vehicles used for work. This includes the following:

    • Third-party liability: This policy protects you in the event that you or an employee are found to be at fault in an accident while driving a commercial vehicle that leads to property damage or injury/death of a third party. It covers legal fees, repairs and medical expenses.
  • Accident benefits: Regardless of who is at fault, this policy covers the driver, any passengers or pedestrians if injured in a vehicle accident. The types of accident benefits include:
      • Income replacement, non-earner and caregiver benefits
      • Medical rehabilitation and attendant care benefits
      • Death and funeral benefits
      • Miscellaneous benefits
  • Uninsured automobile coverage: This policy protects the occupants of a commercial vehicle should they be involved in an accident with a hit-and-run driver or an underinsured at-fault motorist. It covers medical expenses, lost wages and more.
  • Direct compensation-property damage: If you are found not at fault in an accident using a commercial vehicle, this policy covers your vehicle, its contents and the cost of a rental.

Who needs cannabis insurance?

Any licenced cannabis business in Canada must have insurance to protect themselves from lawsuits and various risks. Some of these businesses include:

  • Cultivators (indoor, outdoor and greenhouses)
  • Harvesters and processors
  • Hemp producers
  • Product manufacturers
  • Cannabis consultants
  • Distributors and wholesalers
  • Micro growers
  • Craft growers
  • Medical dispensary owners
  • Cannabis retail owners
  • Research and development laboratories

There are many unique businesses within the cannabis industry. Let our Insurance Heroes determine the best coverage requirements for yours.

What disks does cannabis insurance address?

You may be surprised to learn that all licenced businesses in the cannabis industry must have insurance. In fact, in order to complete your licensed retailer purchasing account, Ontario requires you to have at minimum $5 million in commercial liability insurance. As for suppliers, they’re required to have $5 million in commercial liability and $15 million in product recall insurance. This is because of the many risks it addresses, including:

  • Cannabis product recall insurance
  • Cannabis directors & officers (D&O) liability insurance
  • Cannabis crop insurance
  • Cannabis cargo insurance
  • Cannabis trade credit insurance
  • Cannabis cyber insurance

Get a Free Quote to get started

Start Saving

Get a Cannabis Insurance Quote Today with Insurance Hero

The cannabis industry is ever-evolving. The type of cannabis insurance you need will depend on several variables, such as the type of cannabis industry you are in, how many employees you have, the size of your business and more. Let Insurance Hero help manage your risk and insurance cost by conducting a full commercial insurance policy review to determine what kind of coverage is best for you!

For reliable, affordable Ontario cannabis insurance, please request a quote online or give us a call at 1-855-777-4376. Our team of Insurance Heroes is happy to answer any questions you have!