Eagle's Nest Insurance Services
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Why Insure Your Cannabis Business?
Basics of Insurance
Everybody needs it, everybody has it and nobody seems much like talking about it or even thinking about it, but insurance is a good thing.
Insurance is a contract that TRANSFERS YOUR RISK. Life and business are risky. You don’t have to bear the burden of these risky adventures all on our own. You pay a fee to the insurance carrier and if an incident occurs within the requisite rules of the policy, you are paid a sum that covers your loss. So you can get right back to business.
Insuring Cannabis Legally
Until further notice, cannabis is considered a federally illegal, Schedule I, controlled substance. Technically, running a business in the cannabis industry can be considered a criminal act under federal law. Since banking is a federally insured and regulated industry, most banks won't work with cannabis companies, forcing those companies to deal in cash only. THE CURRENT UNCERTAIN POLITICAL CLIMATE OF THE CANNABIS INDUSTRY INHERENTLY ADDS TO YOUR BUSINESS RISK.
However, insurance is a state regulated industry and, therefore, CANNABIS COMPANIES CAN LEGALLY OBTAIN AND USE INSURANCE in states where cannabis is legal. You can’t write a check from a bank, but you can still legally transfer your business risk.
Why Insure yourself?
Most people and companies would have quite a bit of trouble taking the risks they must take if they do not have a proven way to protect themselves, i.e. obtain insurance.
Ensuring that your cannabis-related business is protected in the event of unforeseen incidences means you can rest easy knowing you can rebound from a disaster.
The Three Major Perils
In the cannabis industry, the three major causes of a loss (perils) are:
Grow fires: loss of your plants/stock, loss of the potential value of the plant, loss of your physical location and all of the stuff inside, possible loss of cash
Theft: by employee or from the outside
Injury: to employees, usually when cutting plants
Other Significant Risks
Disasters that result in a loss of power, water, and other vital operations that would interrupt business
Faulty products that result in harm to consumer
Customers getting hurt on your property
Your delivery person getting in a car accident
Raids by the authorities
Giving incorrect professional advice that results in personal harm
And the list goes on.