Disclaimer: To protect confidentiality, company names and insurance carriers are not disclosed in these case studies. The details provided are generalized to illustrate our expertise and results. Have questions? Call us at: 1-833-374-7475

Background

A brand-only cannabis company, with no plant-touching assets or licenses, faced challenges with their insurance program due to misrepresentation and potential gaps in coverage. The company, generating $55M in topline revenue with 100+ employees, operates through licensing arrangements in every state, packaging their vapes under the licenses of third parties. With an annual insurance spend of $250K, they sought a detailed review of their program to identify improvements and ensure adequate coverage.

Concerns

• Misclassification in the market, leading to inaccurate representation of their operations.
• Potential gaps in coverage, especially for property at third-party locations, putting their assets at risk.

Our Process

1. Data Collection: Gathered their current policies, organizational structure, and previous applications for a detailed assessment.
2. Program Audit: Identified inaccuracies, such as incorrect addresses and missing or outdated endorsements for locations.
3. Gap Analysis: Discovered they lacked property coverage for physical assets and inventory in their care, custody, and control at third-party locations.

Results

• Property Coverage Added: Secured property coverage for assets at third-party locations, despite the inherent challenges.
• Policy Consolidation: Streamlined their General Liability (GL), Product Liability (PL), Property insurance, and Commercial Auto insurance under a single carrier, creating additional leverage and cost efficiencies.
• Address Accuracy: Corrected all location and address discrepancies to ensure proper coverage.
• Editable Statement of Values: Developed a dynamic and editable statement of values, allowing the company to update asset information as needed for better management.

By addressing misclassifications, closing coverage gaps, and optimizing their program, we provided the company with a robust and accurate insurance solution, ensuring peace of mind and financial protection for their operations.

Are you interested in an insurance audit to help reduce your premiums? Contact Frontier Risk today for customized solutions.