New technology and the way a cannabis flower is altered continue to evolve making it a big target for lawsuits.
Litigation always traces a product back to whomever was involved at the point-of-sale and processing. The cannabis growing business is only legal in some states and therefore the industry is not regulated on the federal level. Individual states create their own guidelines and laws making this industry an easy target for lawsuits. Cannabis processors insurance will cover a company if a product made out of that factory causes bodily injury or illness to a third party. The insurance will also prevent risk if someone commits a crime with the cannabis the company processed.
Although having cannabis processors insurance is helpful, it is also recommended that you purchase several other types of insurance coverage as well.
Product liability insurance covers the company in the event that the processor is found liable in terms of a defective product. It will protect the business from product recall and withdrawal, as well as lawsuits due to product malfunctions. It prevents the risk of jail time and litigation charges.
Equipment insurance is also worth consideration as processing equipment is one of the largest investments for generating income in the cannabis business. If something would happen to the equipment during the processing stage, insurance will cover the cost as well as help businesses recover during restoration.
There are many components to the cannabis industry. As this field continues to grow it is important for companies to get the insurance coverage necessary to stay up to date with guidelines and regulations.