Insurance Requirements for the State of California

In the State of California is a.k.a The Golden State has no specific state requirements for business insurance for licensed cannabis dispensary, cultivation, or manufacturing facilities.   The Department of Cannabis Control does indicate the following on their website:

“Insurance protects businesses against certain types of risks, such as:

Property damage
Liability
Worker injury
Natural disasters

When buying insurance, ask your agent or broker if your business would be covered in the event of a cannabis-related loss. Some policies have cannabis or public policy exclusions in them.”

You should note certain cities might have insurance requirements.  If you have employees, then workers compensation insurance is required by law. 

California is susceptible to several types of natural disasters due to its diverse geography and climate. Some of the common natural disasters in California include:

Wildfires: California experiences frequent wildfires, especially during the hot and dry summer months. These wildfires can be sparked by lightning, human activity, or other factors, and they can spread rapidly, particularly in forested areas.

Flash Floods: The desert regions of California are prone to sudden and intense rainfall, which can lead to flash floods. These floods can occur within minutes of heavy rainfall, especially in areas with steep terrain or dry washes.

Extreme Heat: California is known for its hot desert climate, with temperatures frequently exceeding 100°F (37.8°C) during the summer months. Heatwaves can pose serious health risks, particularly to vulnerable populations such as the elderly and outdoor workers.

Drought: Like many western states, California faces periods of drought, which can have significant impacts on water resources, agriculture, and ecosystems.

Dust Storms: Dust storms, also known as haboobs, can occur in California, particularly during the monsoon season. These storms are characterized by strong winds that carry dust and debris, reducing visibility and posing hazards to drivers and outdoor activities.

Earthquakes: California is highly susceptible to eathquakes .

Winter Storms: In higher elevations, particularly on the eastern Sierra and southern California mountains, winter storms can bring snow and ice, leading to hazardous driving conditions and other winter-related hazards.

Need more claim information?  Review our claims pages for important information based on our experience.

If you are a landlord who owns a building with a cannabis tenant you must not only consider weather related events, but damage to the building if there is a theft.

Is there a cannabis surety bond required in the State of California?

A search from The Department of Cannabis Control does indicate a bond requirement.  According the website:   An application for an annual cannabis license must include proof of a surety bond of at least $5,000 payable to the State of California for each licensed premises.

Download California Cannabis Bond Form