Will Your Upcoming Cannabis Grow Be Protected?
By Max Meade
With the weather getting nicer and the smell of spring in the air, cannabis growers are beginning to plan their next grow. For years these grows have been “self-insured,” meaning that cannabis farm owners assume the risk if something happens, and have to incur the cost of a loss themselves. However, those days are behind us as cannabis becomes more mainstream and states allow these farmers to establish viable businesses. Because of this, the opportunity for growers to insure their crops has arrived!
Insurance is now available to those who operate an indoor grow facility. It can protect the building, people on the premises, workers at the facility, equipment used for the grow and—the best part—the plants! Yes, the actual plants may be insured, in case something occurs during the growing season to damage them. Below are different scenarios in which protection and coverage may be available:
⦁ You leave the cultivation facility and head home for the evening. During the night, a power surge occurs, which results in equipment over-heating, catching on fire and completely wiping out the facility and crops. Instead of having to suffer that entire loss, with the right coverages in place you may be reimbursed for the lost facility, equipment and personal property inside, the time it takes to get your business up and running again, as well as the cost of plants lost, at their replacement value for the state they were in when destroyed.
⦁ You lock up your dispensary for the night and head home after a long day. During the night, you are alerted by your security system/monitoring company that a break-in has occurred. You rush to the dispensary to find that someone has broken in through a wall and see that your plants have been stolen. You think, “What am I going to do?” but remember that you have an insurance policy to handle this. Good thing you worked with an agent who understands that these types of events happen and, because of this, you will now be reimbursed for the stolen plants along with the cost to have the broken wall repaired.
⦁ You operate a large wholesale cultivation facility with over $10,000,000 worth of crops. During the night, a pipe breaks, causing water to damage the facility, along with destroying half the crop. You walk in the next morning in complete disbelief and don’t even know where to begin. You call me, saying, “Max, a pipe burst overnight and half of my crop is destroyed and the floor is water-damaged. Please tell me we are covered for this.”
My response to you is: “I’m so sorry to hear that; but don’t worry. Because of the size of your grow, we were able to get you seed-to-sale coverage, meaning that you are protected from the moment you planted your first seed in the soil to the moment you sell the plant in its finished form. You will be fully reimbursed for your damaged crops and, because we also worked to get you property coverage, all you need to do is meet your deductible and you will have your floors replaced and even be reimbursed for business expenses until you are back to normal operations.” Unless you work with an agent who understands the aftermath of something like this, you may not be so lucky.
These are just three examples of losses—out of hundreds, if not thousands—that may potentially occur at any point in time and cause serious problems for you and your business. You may also have noticed the additional losses that were associated with losing your crops. Take the third example: Not only did this business lose half of their crop, but due to the water damage to their floors they won’t be able to operate until the floors are repaired. I say this because it is important to protect all of your assets and to be aware of all the potential problems that could occur.
My question for you is: Why not prepare for this ahead of time? Reach out today and I will be more than happy to work with you to make sure that you and your cannabis business are properly protected.