Cannabis Crop Insurance

Crop Coverage for Cannabis Operations

Crop coverage refers to insurance that protects against damage or loss of cannabis crops during various stages of growth, including seeds, seedlings, vegetative plants, flowering plants, harvested plants, and finished stock. This coverage is essential for mitigating risks associated with cannabis cultivation.

Indoor and Greenhouse Facilities

Currently, crop coverage is most widely available for cannabis crops grown indoors and in approved greenhouse facilities. These environments provide controlled conditions that are favorable for insurance providers.

Emergence of Outdoor Crop Coverage

While outdoor crop coverage has been limited, new markets willing to insure full outdoor crops and hoop houses have emerged over the past 6-10 months. As the cannabis industry grows and evolves, it is expected that more insurance companies will begin offering outdoor crop insurance.

What Does Crop Coverage Protect Against?

Types of Coverage

Crop insurance for cannabis operations may cover loss due to various circumstances, including:

• Theft: Protection against stolen crops.
• Fire: Coverage for damage caused by fires.
• Explosions: Insurance for losses resulting from explosions.
• Vandalism: Protection against intentional damage to crops.
• Equipment Breakdown: Coverage for losses due to the failure of essential equipment.
• Environmental Control/Monitoring System Failures: Insurance for damages caused by failures in greenhouse or indoor control systems.
• Automated Pumps & Compressors: Protection against breakdowns of these critical systems.
• Interruption of Service: Coverage for losses due to disruptions in essential services.

Why is Crop Coverage Important for Cannabis Operations?

Financial Protection

Crop coverage provides financial protection for cannabis operations, ensuring that losses from various risks do not severely impact the business. This protection is crucial for maintaining financial stability and ensuring the sustainability of the operation.

Coverage During Harvest Time

Even if outdoor crop coverage is limited, there is significant protection available during harvest time for indoor and greenhouse facilities. This ensures that the valuable stages of crop production are covered.

How is Crop Coverage Calculated?

Factors Considered

Coverage for cannabis crops is calculated based on information provided by the grower. Key factors include:

• Estimated Number of Harvests per Year: Frequency of crop cycles.
• Production per Plant: Average ounces produced per plant.
• Wholesale Value of the Plant: Market value of the crop.
• Number of Plants in Different Growing Stages: Stages of cultivation from seeds to finished stock.

Premium Calculation

Premiums are calculated based on the wholesale value of the crop at each stage of the cultivation cycle. This ensures that the coverage accurately reflects the value of the crops at any given time, providing comprehensive protection.

Who Should Consider Crop Coverage?

Cannabis Growers and Cultivators

Any cannabis grower or cultivator involved in indoor, greenhouse, or emerging outdoor cultivation should consider crop coverage. This insurance is vital for protecting against the numerous risks associated with cannabis farming.

Conclusion

It is important to note that the crop coverage is dependent on several safeguards that must be in place. Here at Cover Cannabis, we have a team of experts that can provide more information depending on your specific crop, and ensure you are fully covered. We’ll walk you through the entire process. Call us today and let’s explore your options.

Once we’ve determined the specific insurance option needs for your business, we’ll set you up with a FREE quote!

---

Sources

1. Cover Cannabis Insurance Services – Crop Insurance for Cannabis
2. Marijuana Business Daily – Insurance Trends in Cannabis Industry
3. Forbes – Risks and Insurance in Cannabis Cultivation
4. Insurance Journal – Crop Insurance for Cannabis Growers
5. Leafly – Understanding Cannabis Crop Insurance