For more on this part of the insurance industry:
1. visit our cannabis insurance page for a look at all products in this sector
2. or focus in on all of the cannabis product insurance products available on IB Markets!
Cannabis product insurance is a type of coverage designed for businesses that cultivate, produce, or distribute cannabis products. This insurance type addresses unique risks such as:
The global cannabis industry grew in 2024, with legal cannabis sales surpassing US$31 billion worldwide. This expansion shows the increasing need for comprehensive cannabis product insurance coverage, even in Australia.
Benefits of this insurance include safeguarding assets, guaranteeing business continuity, and improving credibility with stakeholders. While recreational cannabis use is limited, most medicinal cannabis is provided through its various product forms.
The Australian cannabis product insurance industry is being challenged by cultivation hazards, storage concerns, and product liability issues. This raises questions about insuring cannabis facilities. New products also increase the chance of liability claims which makes safety and quality control critical for insurers.
Besides these threats, the industry is also seeing new trends like:
health insurance changes: medicinal cannabis coverage is influenced by NSW laws, which impact private health insurers
new product liability risk: vapes, beverages, and care items introduce new risks in cannabis product insurance
customised insurance demand: growing cannabis businesses need tailored coverage for cultivation and retail
Ongoing changes in cannabis regulations require insurers to stay informed about local laws for compliant and effective coverage. Brokers should help clients handle these sensitive changes while finding the right solutions for Australia’s cannabis product insurance sector.
Learn more about other types of coverage under the broader Cannabis Insurance page.
In Australia, medicinal cannabis is generally not covered by the Pharmaceutical Benefits Scheme (PBS).
However, some private health insurers offer rebates for non-PBS prescriptions, which can include medicinal cannabis products.
No, Medicare does not cover medicinal cannabis products in Australia.
Patients must bear the full cost, which can range from $50 to several hundred dollars per month, depending on the prescription.
Currently, there are no specific tax deductions for medicinal cannabis expenses in Australia. Patients should consult with a tax professional to understand potential deductions related to medical expenses.
The cost of medicinal cannabis in Australia varies based on factors like the specific product, dosage, and individual patient needs. Prices are shown below:
average daily costs: medicinal cannabis typically costs $10 to $15 per day, adding up to around $300 to $450 per month
higher expenses for some patients: costs can range from $50 to $1,000 per week for those requiring higher dosage or specific products
doctor consultation fees: initial consultations cost $79 to $200, with follow-up appointments ranging from $49 to $100
As the industry grows, treatment costs are gradually decreasing, improving accessibility. Similarly, cannabis product insurance is aligning with the trend toward affordability.
Medicinal cannabis is generally not subsidised under Australia's PBS program, making it an out-of-pocket expense for most patients. However, certain programs like the Compassionate Access Program offer subsidies to eligible patients, covering a portion of the costs.
Recreational cannabis use remains illegal under federal law in Australia. As such, recreational marijuana insurance does not exist.
In the Australian Capital Territory (ACT), owning and cultivating cannabis are no longer a crime. This applies to anyone over 18 under the ACT cannabis rules. These rules also allow:
Selling or transferring cannabis to others is illegal.
In Northern Territory and South Australia, recreational cannabis use remains illegal. Possession of small amounts can result in fines rather than criminal charges.
Yes, any registered medical practitioner in Australia can prescribe medicinal cannabis if they believe it is appropriate for the patient's condition.
However, prescribing unapproved medicinal cannabis products requires approval from the Therapeutic Goods Administration (TGA) and, in some cases, state or territory health departments. Doctors unfamiliar with the approval process may refer patients to specialised cannabis clinics.
Entities involved in the cannabis industry that usually require product insurance coverage include:
Cannabis product insurance is essential for protecting assets and maintaining credibility in the growing cannabis market.
