Hydrolife Magazine December/January 2017 (USA Edition)

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PROTECTING YOUR
Growing Business
by Chelsea Fox | You have a great product and scouted
out the perfect storefront location, but before you finally
open the door to your new cannabis business, you need to
take one last important thing into consideration: insurance.
“
Whether they are a grower,
dispensary owner, supplier,
or processor, marijuana
entities looking to sell to the
public are now businesses
that need insurance.”
Congratulations! You’ve made the
jump to becoming a business
owner. To get here, you probably spent
endless hours researching everything
you needed to get your operation up
off the ground and running. You looked
at parking, a noticeable location with
ease of access, and so much more.
Now, there’s one last thing: insurance.
In the states that have legalized
marijuana, insurance coverage is
one of many regulations business
owners encounter. As Ed Kuhn,
president of Creative Edge Nutrition
and Wellness Medical Protection
Group/Liability Insurance Solutions,
stated in the September 2014 issue of
Insurance Journal, “Whether they are
a grower, dispensary owner, supplier,
or processor, marijuana entities
looking to sell to the public are now
businesses that need insurance.”
There are few select companies who
have stepped up to the plate to insure
this new market in line with their
state laws. However, most insurance
carriers are choosing to watch
from the sidelines due to the everchanging
risks and hurdles presented
in the process of legalizing marijuana
for medical and/or recreational use.
Still, they are also assessing data
collected from those who are insuring
cannabis businesses, and it is safe
to say that as knowledge of how the
industry works increases, so will the
limits of coverage.
Kuhn’s agency is one that evaluated
the risks and started helping business
owners in Colorado navigate their
new ventures. Select insurance
companies in Michigan, where I work,
have also assessed the risks and
developed eligibility requirements
correlating with Michigan state laws.
Marijuana businesses must meet
those requirements in order to qualify
for coverage. The number one of
these is that businesses must be housed
in a commercially zoned building.
Residential properties, such as homes,
vacant lots with a pole barn on the
outskirts of town, or a garage, will not
qualify for insurance.
Those of you who already bought a
residential lot for your business, don’t
panic. While it’s a bit of a process, you
may consider applying to rezone your
lot from residential to commercial.
Before you do, however, learn about your
community and find out if they will be
accepting of your business venture. Also,
attend zoning meetings before you file
the application to rezone your property
for commercial use.
Although procedures vary from municipality
to municipality, the rezoning
process then typically involves public
notice, meetings with planning commission
officers, and neighborhood meetings.
As you might imagine, this process
could take several months.
With so many investment dollars
going into your grand opening, don’t
chance anything. Find an insurance
carrier willing to insure the cannabis
market in your state; not only is it
more convenient than working with
an out-of-state carrier, but an in-state
company can better help you meet the
proper zoning requirements for your
county or city. Also, be sure to work with
a qualified representative who knows
the limits of coverage and how to
properly use them so you can grow your
business in the right direction.
Chelsea Fox is a licensed insurance
advisor who has lived in Holland,
Michigan, with her husband since
graduating from Olivet College in 2012.
Chelsea’s passions not only include
insurance, but also hiking, bird watching,
hunting, and fishing. Basically, if she is
outside and active, she is happy.
74 grow. heal. live. enjoy.
myhydrolife.com