Insurance for legal marijuana industry is still in the early stages of development. Historically, the insurance industry moves at a glacial pace compared to the speed of change in society. However, in the case of cannabis insurance, there are now several major carriers that will provide broad coverage for a relatively affordable premium. One type of coverage that many business owners overlook is loss of income insurance. Loss of income coverage is critical to protecting your cannabis dispensary, and could mean the difference between a fast recovery or closing your doors.
Insurance policies define income as net income before taxes plus ongoing expenses. Essentially, we are talking about insuring your pre-tax profit and certain continuing expenses such as rent, utilities, and payroll. In addition, most business income coverage forms include “extra expense” coverage to pay for expenses that help to shorten the period of time you are shut down.
There are several ways business income coverage can be provided such as a co-insurance form, monthly limit of indemnity, or maximum period of restoration. We find the monthly limit of indemnity form to the be the simplest and it also avoids any potential co-insurance penalty. However, this form also limits how long coverage will be provided based on the fractional limit (i.e. 1/3, 1/4, or 1/6). With any type of business income coverage, getting the coverage amount right is critical.
Get a Quote for Loss of Income Coverage
The team at Cannabis Insurance Pros understands the coverage needs of the legal marijuana industry. We have several competitive insurance programs that include general liability and property coverage for your business. We can help you determine how much business income coverage you needs and what policy form will be best for your operation.
Whether you have a cannabis dispensary, cultivation operation, testing lab, medical marijuana office, or other operation, let us provide you with a no-obligation quote today!
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