Cannabis dispensary insurance in Washington State

In Washington, cannabis businesses are regulated by the Washington State Liquor and Cannabis Board. Washington state law requires cannabis dispensaries to carry:

• General liability insurance: Limits should not be less than $1 million and coverage must be insured through a carrier with a rating of A - Class VII or better.
• An additional insured endorsement: Businesses must name the state and its employees, agents, and volunteers on the policy as an additional insured.

General liability insurance 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. It is often required to sign a commercial lease, a loan, or a contract.

To comply with Washington state 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 Washington 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, dispensaries are legal in Seattle and Spokane, but banned in Federal Way, Kennewick, and Oakesdale.

You’ll need to research your state, county, and city laws to make sure your dispensary or other cannabis business is obeying the rules.

While general liability insurance is vital to running a dispensary in Washington, it's not the only insurance product you need. 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 typically included in general liability insurance.
• Commercial property insurance helps pay for stolen, damaged, or destroyed business property. For example, it can cover the cost of replacing inventory after a burglary, 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 primary 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.