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Cannabis dispensary insurance in New York
Each state has its own laws and regulations for cannabis business insurance. In New York, cannabis is approved for both medical and adult recreational use. Dispensaries are not required to carry cannabis business insurance in order to operate legally.
What types of insurance do New York dispensaries need?
In New York, cannabis businesses are regulated by the New York State Office of Cannabis Management (OCM). The OCM does not require dispensaries to carry cannabis business insurance.
However, cannabinoid hemp processors must provide proof of product liability insurance. Applicants for medical-use cannabis businesses must also have the property and equipment necessary to operate, or post a $2 million surety bond.
All cannabis businesses should carry general liability insurance, which they might need to secure a loan, or sign a commercial lease or contract. A commercial general liability policy covers the most common risks of owning a small business, such as lawsuits from customers who suffer an injury or property damage at your shop.
To comply with New York law, your business needs to carry workers’ compensation insurance if you have employees. And, if you have any business-owned vehicles, state law requires that you carry commercial auto insurance.
Keep in mind that although NY has approved cannabis for medical and recreational use, each city and town is permitted to decide whether or not to allow cannabis businesses. For example, New York City allows dispensaries, but the town of Rhinebeck does not.
You’ll need to research your state, county, and city laws to make sure your dispensary or other cannabis business is obeying the rules.
What other types of business insurance do I need for my cannabis dispensary?
While there are no cannabis business insurance requirements in New York state for running a dispensary, it's still a good idea to get coverage to keep your business protected. Dispensary owners should also consider the following policies:
- Product liability insurance covers legal costs if a customer sues over harm caused by a product sold at your dispensary, such as an adverse reaction to an edible. It’s often included in general liability insurance.
- Commercial property insurance helps pay for lost, damaged, or destroyed business property. For example, it can cover the cost of replacing stolen inventory or renovating a marijuana dispensary’s building after a fire.
- Property policies can include business interruption insurance, which covers costs when a fire or other covered property claim forces your business to close temporarily.
- Additionally, you may need inland marine insurance to protect property in transit or stored off-site, as property insurance only covers items at your business location.
While these are a top priority for cannabis sellers, they aren’t the only policies you need to run a business. You can always call our dedicated agent at (872) 260-5150 if you’re unsure which policies you need.
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What are the laws and requirements for cannabis businesses in New York?
There are several requirements for running a cannabis facility in New York state.
Perhaps most important, you need a license from the OCM to open a dispensary or other cannabis business. To keep that license, you need to follow the OCM's rules about selling, storing, and transporting cannabis.
For example, New York requires cannabis businesses to:
- Maintain a written training manual that includes worker operating and safety procedures
- Adhere to NY cannabis tracking regulations, which includes using the BioTrack seed-to-sale system
- Install a security alarm system that includes video surveillance
- Follow marketing and advertising regulations, such as no advertisements near schools
Be sure to read New York's laws and requirements [PDF] to make sure your cannabis business is in full compliance.
How can I get business insurance for my New York dispensary?
If you run a dispensary, you can complete Insureon’s easy online application to get quotes from top U.S. carriers. For other cannabis businesses, you can call our dedicated agent at (872) 260-5150 to get insurance quotes for your business. Once you find a policy that fits your needs, you can begin coverage in less than 24 hours.
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Updated: September 13, 2023
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