The hemp and CBD industry has grown dramatically since the 2018 Farm Bill, but the insurance market for hemp businesses has struggled to keep pace. Obtaining adequate, affordable coverage requires working with a broker who truly understands this industry.
The Unique Risks of the Hemp and CBD Industry
Hemp and CBD businesses face a convergence of risks that few other industries share: product liability exposure for consumable products, regulatory uncertainty at both the state and federal level, crop loss risk for cultivators, complex supply chain exposures, and limited access to standard insurance markets due to the association with cannabis. Managing these risks requires a comprehensive insurance strategy — not just a general liability policy.
Core Coverages for Hemp and CBD Businesses
A complete hemp and CBD insurance program typically includes general liability with product liability, commercial property, crop insurance for cultivators, product recall, workers’ compensation, commercial auto, and potentially cyber liability for businesses that sell direct-to-consumer online. Directors and officers insurance is essential for any hemp business with investors or a formal board structure.
Labeling and Regulatory Compliance Risks
The FDA’s evolving position on CBD in food and dietary supplements creates regulatory compliance risk for hemp businesses. Claims alleging mislabeling, inaccurate potency claims, or improper marketing are increasingly common. Product liability policies designed for hemp businesses should address these specific allegations rather than relying on standard product liability language that may not respond correctly.
Working with Hemp-Friendly Carriers
Many mainstream insurance carriers still decline to write hemp and CBD businesses. The carriers that do write this industry understand the distinction between hemp and marijuana, the regulatory framework under the Farm Bill, and the testing and compliance practices that reduce risk. Bozzuto Group has spent years building relationships with these specialty carriers and can access coverage that most brokers simply cannot.
Bozzuto Group: Your Hemp Insurance Specialist
CEO Stephanie Bozzuto is nationally recognized for her expertise in hemp, CBD, and natural products insurance. Whether you’re a cultivator, processor, manufacturer, or retailer, Bozzuto Group can build an insurance program that protects your hemp or CBD business at every stage. Contact us today.