If you are a marijuana cultivator in California, you might be reluctant to buy insurance on your business. But our experienced cannabis business attorneys know there are many good reasons to invest in insurance.
A recent article from Santa Barbara Independent reveals a big payout one cannabis farmer in Carpinteria received due to losses caused by the Thomas Fire in December, the largest wildfire in the state in recent history. The farm got more than $1 million dollars from their insurance company after thousands of marijuana plants on property were destroyed. This equated to about market value for the plants. While the farm’s crops did not burn in the fire, white ash blew into the greenhouses and tainted the plants. The plants tested positive for lead, arsenic, asbestos, and magnesium. This type of damage was covered under the policy’s clause covering changes in atmospheric conditions.
Meanwhile, most of the other cannabis farms in Northern California were not so fortunate. Many opted out of insurance policies to keep costs low. This money-saving tactic is typical among farmers of all kinds, who often skip this expense to keep profit margins higher. But this is a big gamble, particularly in an area so prone to fires. Our Riverside cannabis business attorneys know that some owners avoid insurance policies in order to keep a low profile. This is rooted in years of living in fear of government crack downs and the failed “War on Drugs,” which is charade used to control and oppress certain communities. A huge weight has been lifted with the implementation of Proposition 64 this year, making both medical and recreational marijuana legal in California.
But the shift in power at the federal level and the insistence of Attorney General Jeff Sessions to enforce marijuana’s Schedule I classification under Controlled Substances Act, 21 U.S.C. Section 812. Owners are unsure who to trust and feel vulnerable with each new relationship they have to form to keep their operation afloat. However, given that insurance is already required for other aspects of business, such as liability, building protection, and workers compensation, insurance to protect the crops so vital to your profits just makes good sense. These good business practices are all the more reason marijuana finally deserves to be declassified at the federal level and be officially legalized nationwide.
Others may not even know that there are options to insure crops, since insurance companies must abide by federal regulations. But recent workarounds have opened up options.
The uncertainty owners feel right now is why it is so important to rely on the legal guidance of a skilled law firm to guide your cannabis business. Our business counseling services help you make essential choices for your business and keep you in compliance, while keeping a watchful eye on happenings on the federal level. We know how stressful staying current on regulations can be while managing a farm, dispensary, or production facility. That’s why we do the heavy lifting for you.
We also know fear of the government should not prevent you from doing what’s best for your business. We can advise you on the best decisions to protect your assets, resources, and profits, while remaining compliant with state and local laws.
The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients, defendants, workers and those facing criminal marijuana charges. Call us at 949-375-4734.
Cannabis Farmer Gets Over $1 Million Insurance Payout, March 19, 2018, By Kelsey Brugger, Santa Barbara Independent
More Blog Entries:
California Department of Insurance has First Filing for Cannabis Coverage, Nov. 11, 2017, Cannabis Law Group