If you’re operating a licensed marijuana (also known as cannabis) business, Washington state rules (leg.wa.gov) require you to buy insurance to protect your business from potential losses.
Who may need to buy marijuana business-related insurance
- Marijuana retail stores
- Marijuana producers
- Marijuana processors
- Landlords who rent to marijuana business owners
What insurance covers
In Washington state, your coverage must include (leg.wa.gov):
- Commercial general liability coverage – This protects business owners against losses due to bodily injury or property damage that occur during business operations.
- An insurance carrier rating of an A-Class VII or better – The insurer must have good financial stability, claims service and customer satisfaction ratings.
- Additional insured – This means you must add the state and its employees, agents, and volunteers to your policy as an additional insured to protect them in the event your business is negligent.
Be sure to talk with an insurance agent or broker about the availability and type of coverage you’ll need for your business.
What it doesn't cover
Regarding business liability and business property coverage, your insurance company may cover some interests, yet exclude marijuana products due to the conflict between federal and state laws.
If your business is located in your home, be aware there could be exclusions under your homeowner insurance policy for running a marijuana-related business.
Where to find coverage
Although the sale of marijuana is legal in Washington state, some insurers may not want to offer you insurance coverage because the federal government considers it an illegal substance. Coverage may only be available from high risk, non-Washington licensed insurers called surplus line insurance companies.
Talk to your insurance agent or broker who can help you obtain coverage through a surplus line insurance company.
What it costs
The premiums vary among insurance companies, so comparison shop for cost and coverage.