Hemp businesses, from farming to distribution, face risks related to crop loss, compliance, and product liability. Here’s a list of the most common risks for hemp businesses:

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Crop Loss Due to Weather or Pests

Hemp farming is exposed to risks like extreme weather, natural disasters, and pest infestations, all of which can severely impact yields and profitability. With the 2018 Farm Bill making hemp federally legal, the industry has grown significantly, but greater popularity also means greater risks. Crop insurance offers financial protection to keep your operations stable and secure.

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Product Contamination or Recall

Hemp products, including CBD extracts, textiles, and wellness items, face risks of contamination during production or processing. Contaminated products can lead to recalls, legal claims, and reputational harm, making product liability insurance an essential safeguard for your business.

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Labeling and Dosing Errors

Precise labeling and dosing are critical for hemp-derived products, especially those containing CBD. Errors can lead to compliance violations, customer complaints, and even lawsuits. Product liability insurance helps mitigate these risks, ensuring regulatory compliance and protecting your business.

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Theft of Hemp Crops or Products

Hemp, defined as cannabis with 0.3% THC or less, is highly valuable and a common target for theft during cultivation, processing, or transport. Property insurance and transit insurance protect against these losses, ensuring your business remains operational despite unexpected setbacks.

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Compliance Failures with Regulations

The 2018 Farm Bill allows hemp to be legally grown, processed, and sold nationwide, but businesses must still navigate a patchwork of state and federal regulations. Non-compliance can lead to fines, license suspension, or even shutdowns. While insurance policies do not directly cover non-compliance, cannabis-specialized providers like Frontier Risk ensure that your business fulfills all insurance requirements.

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Supply Chain Disruptions

Delays or shortages in the supply chain, such as issues with raw materials or transportation, can halt production and reduce profitability. Transit insurance and property insurance safeguard against these risks, ensuring your business can handle unexpected challenges. Unlike cannabis, Hemp does not have intrastate commerce restrictions and can be distributed across state lines. This makes supply chains simpler and less costly, however there is less control.

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Employee Injuries in Production or Processing Facilities

Hemp cultivation and processing often involve physical labor and the use of machinery, increasing the risk of workplace injuries. Workers’ compensation insurance ensures coverage for medical expenses and lost wages, protecting employees and keeping your business compliant with labor laws.

Hemp businesses deal with risks like crop loss, product contamination, and complex regulations. To protect their operations, hemp businesses need tailored insurance coverage. Here are the key types of insurance hemp businesses typically need:

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Crop Insurance

Crop insurance is critical for hemp farmers, offering financial protection from losses due to extreme weather, natural disasters, or pests. This coverage is intended to create stability in an unpredictable agricultural environment.

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Product Liability Insurance

Product liability insurance is intended to protect hemp businesses from legal claims and financial losses associated with contaminated or mislabeled products. It is essential for maintaining consumer trust and regulatory compliance.

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Property Insurance

Property insurance is intended to cover facilities, equipment, and inventory against theft, fire, and other risks. This ensures your physical assets remain secure, minimizing financial disruptions to operations.

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Cargo Insurance

Cargo insurance is intended to protect hemp products during transportation, covering losses from theft, damage. This ensures the safe delivery of your products and reduces the financial impact of supply chain disruptions.

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Workers’ Compensation Insurance

Workers’ compensation insurance is intended to provide coverage for employee injuries or illnesses sustained in production or processing facilities, ensuring compliance with labor laws and protecting your workforce.

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General Liability Insurance

General liability insurance is intended to offer protection against third-party claims for bodily injury or property damage, providing your hemp business with essential financial and legal security.

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Cyber Liability Insurance

Cyber liability insurance is intended to protect against data breaches or hacking incidents that could compromise sensitive operational or customer information, ensuring business continuity. 

Cannabis Specialized

We understand the cannabis industry, your challenges as a business owner, and the license specific insurance you need.

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Fast Quoting

Our online quoting for cannabis insurance ensures that you receive quotes from the top carriers.

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Fair Prices

We offer fair insurance prices for cannabis businesses, providing equitable rates comparable to other industries.

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Easy Policy Management

Our customer portal allows you to conveniently manage your policies, download certificates, report claims, and more.

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Dedicated Support

Our dedicated support team puts your needs first, providing round-the-clock assistance. When you call, we'll be there.