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What cannabis product liability insurance covers
Quick answer: Cannabis product liability insurance covers you if you’re found liable for a defective product. If a consumer gets sick, has an accident or reports side effects, lawsuits often reach every business in the supply chain, not just the seller. Product withdrawal coverage helps pay the high cost of pulling a defective or contaminated product from the market.
Cannabis Product Liability Insurance provides coverage in the event that you are found liable due to a defective product.
It’s important for you to know that it has become increasingly common for litigation to go after every operation that had involvement of the compromised product, tracing back from the point of sale. In the event that a consumer becomes sick, is involved in an accident, commits a crime, experiences “side effects,” or other mishap related to the product you could be held liable regardless of where your operation falls within the supply chain. Due to heightened media attention, varying laws and the remaining conflict between federal and state regulation, cannabis businesses have become easy targets for lawsuits.
If you were to face a product liability claim, one of the best actions you can take is to withdraw your product. This is a radical step that a company can take to respond favorably to the notice of a defective, or potentially contaminated product. The process of withdrawing a product is much more expensive and stressful than most realize and by having withdrawal coverage in place, you can position yourself to proactively prevent greater losses. Contact The Cannabis Coverage Company today to speak with one of our cannabis insurance specialists and to learn more about Cannabis Product Liability in regards to the cannabis insurance industry.
Cannabis product liability insurance FAQ
What does cannabis product liability insurance cover?
It provides coverage in the event that you are found liable due to a defective product, for example when a consumer becomes sick, is involved in an accident or experiences side effects related to a product.
Can a product claim reach my business if I did not sell the product?
Yes. Litigation increasingly goes after every operation that was involved with the compromised product, tracing back from the point of sale, so you could be held liable regardless of where your operation falls within the supply chain.
What is product withdrawal coverage?
Product withdrawal coverage helps pay the cost of pulling a defective or potentially contaminated product from the market. Withdrawing a product is often more expensive and stressful than most business owners realize.
What affects the cost of cannabis product liability insurance?
Pricing depends on your business. Common factors include your operation type (for example, retail, cultivation, manufacturing or distribution), the products you sell, your annual revenue, the state you operate in, your claims history, and the limits and deductibles you choose. For pricing based on your products, request a quote from The Cannabis Coverage Company.