Excess Insurance for Cannabis Businesses

What is Excess Liability Insurance?

Excess liability insurance is a way for you to provide coverage for your business in the event of catastrophic losses. Rather than increasing the limits of each insurance policy, you can purchase an excess policy which will provide additional coverage over your other insurance policies.

Excess policies are a cost-effective way to offer higher limits for your business and protect you from catastrophic losses.

What businesses should consider excess liability insurance?

Excess liability insurance is designed to provide coverage for underlying liability policies that have reached their limits. As such, any cannabis operation that has a liability insurance policy should consider investing in excess liability insurance to guard against catastrophic loss. 

For instance, if you’re found liable for $4 million in damages, but your policy only covers $2 million, you can make a claim on your Excess Liability policy to cover the difference.

What is Included in Excess Liability Insurance?

Excess Liability insurance can provide coverage for the following situations: 

      • Litigation related to your business
      • Bodily injury and property damage
      • Additional protection for the various policies you already have in place

What are the benefits of having Excess Liability Insurance?

Provides an Extra Layer of Liability for your Primary Insurance Policy

While you should always plan for the worst by investing in insurance designed to protect your business from litigation, there’s nothing wrong with having a backup just in case you exceed your policy limits. In most instances, Excess insurance will cover claims that are covered under your primary liability insurance policies.

Protect Your Assets

Many cannabis businesses have extensive assets to protect. If a lawsuit should not rule in your favor and the monetary payouts are large, you may be asked to sell off assets to cover the award. Excess Liability insurance helps you avoid this situation, allowing you to protect the assets needed to keep your business running smoothly.

Provides Extra Protection for High Claim Industries

The cannabis industry is no stranger to litigation. Cannabis business owners should always be on their guard against a potential lawsuit, and Excess liability insurance allows them to be prepared for any scenario that should present itself.

Tips for Choosing Excess Liability Insurance

Is defense covered outside the limit?

Your insurance policy should explicitly state that the insurer will pay defense fees in addition to the policy limit. This is imperative because court fees are often very high. If the court fees have a significant impact on your insurance limit, you may have little to no coverage to cover damages.

Talk with your insurance agent to ensure you’re fully covered to meet the needs of your business.

Find What’s Excluded from your Insurance Policy

Before signing the dotted line, always check to see what’s excluded from your policy. For instance, if you have General liability and Cargo insurance, your Excess liability policy should include these coverages, amongst other policies relevant to your business.

Work with an Experienced Insurance Broker

While most insurance brokers can provide the necessary legwork to provide coverage for your business, they may not understand the nuances of the cannabis industry. As such, they may not provide the guidance needed for your business to avoid legal trouble. Select an insurance broker  who understands the cannabis industry so they can tailor an insurance policy perfectly suited to your needs.

Get an Excess Liability Insurance Quote

For a quote or to learn more about excess liability insurance, reach out to us today.

Our Partnerships

Blog

Builder’s Risk, Excess Liability Rates Climbing Fast

INSURANCE RATES are rising rapidly for contractors, particularly for builder’s risk and excess liability policies as the cost of claims continues to increase dramatically.While rates for builder’s risk have been averaging 10 to 20%, pricing for excess liability and...

Fudging Payroll Records Can Lead to Fines, Jail

THE OWNERS of a California flooring installation company allegedly underreported their payroll amounts to workers’ compensation insurers to the tune of $30 million. The men are each facing three felony charges. These are the potential consequences for those who...

New Rules Relax COVID-19 Emergency Standard

CAL/OSHA LAST November issued COVID-19 emergency temporary standards, and now the agency has revised those standards to reflect the reduced risk of infection as more people get vaccinated. The revisions provide respite to many businesses ahead of the planned reopening...

As Workplaces Open, Experts Fear Lawsuit Tsunami

AS MORE Americans return to the workplace, employers are now facedwith the difficult issue of transitioning reluctant staff back as well as complaints and legal action from the most reluctant of workers. Already some returning workers have started to sue their...

Department of Labor Backtracks on New Regulation

PRESIDENT BIDEN’S Labor Department has rescinded a Trump-era rule that would have made it easier for businesses to classify workers as independent contractors instead of employees under the federal Fair Labor Standards Act. In the last month of the Trump...

Bureau Files 2.7% Rate Increase for Sept. 1

THE WORKERS’ Compensation Insurance Rating Bureau of California has recommended that benchmark workers’ comp rates be increased by an average of 2.7%, for policies incepting on or after Sept. 1. The recommendation has been sent to Insurance Commissioner Ricardo Lara,...