Cannabis properties insurance

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 properties insurance products available on IB Markets!

What is cannabis properties insurance? 

Cannabis properties insurance is a tailored form of protection designed for physical assets, real estate, and other property critical to cannabis operations. Key business assets include: 

• facilities: real estate such as greenhouses, warehouses, dispensaries, and processing plants 
• equipment: machinery for cultivation, manufacturing, and packaging 
• inventory: cannabis crops, harvested plants, and finished products 

Cannabis properties insurance is an essential investment for businesses in this high-risk, high-reward sector. It helps businesses address operational vulnerabilities, regulatory requirements, and unique threats.  

This specialised insurance makes sure businesses can thrive while maintaining legal compliance and financial security. 

Cannabis properties insurance: industry trends and emerging risks 

The use of flammable materials, such as expanded polystyrene (EPS), increases fire hazards in medicinal cannabis facilities, complicating insurance underwriting. Strict Australian regulations for security, licensing, and environmental compliance further challenge operations.  

High-value crops and equipment heighten theft and damage risks, while current trends are also shaping the cannabis properties insurance industry: 

• cyber liability coverage: insurers tackle e-commerce threats with policies covering data breaches and ransomware attacks 

• risk management focus: better security and fire prevention measures help reduce vulnerabilities and improve coverage to insure medicinal cannabis facility 

• facility investments: new large-scale facilities highlight growth opportunities in Australia 

Building community relationships helps reduce stigma and secure regulatory approvals. 

Cannabis properties insurance FAQs 

Is theft a common issue for cannabis businesses? 

Theft is a major concern for cannabis businesses due to the high value of products and cash transactions. Using strong security and having cannabis properties insurance are key to reducing these risks. 

Who needs cannabis properties insurance coverage? 

Cannabis properties insurance in Australia is vital for protecting physical assets across various sectors of the cannabis industry. Those who need this coverage include: 

• testing laboratories: cover facilities and quality control equipment 
• equipment suppliers: protect inventory and business premises 
• cultivators: need coverage for greenhouses, grow rooms, and equipment 
• manufacturers: protect facilities and customised cannabis processing machinery 
• distributors: insure storage warehouses and transport hubs 
• retailers: safeguard dispensaries and storefronts from risks 
• property investors: make sure leased cannabis-related properties are insured 
• ancillary services: includes consultants and service providers operating in cannabis-related facilities 

Cannabis properties insurance will safeguard assets and guarantee continued operations in this high-risk industry. 

What are common cannabis properties insurance coverage options? 

Cannabis properties insurance gives businesses in the cannabis industry options to stay protected. Coverage options include: 

• property insurance: protects buildings, equipment, and inventory from damage or theft 
• general liability insurance: covers legal costs for third-party injury or property damage claims 
• product liability insurance: protects against claims from defective or harmful products 
• crop insurance: covers losses from pests, disasters, and weather affecting crops 

Another important one is business interruption insurance, which helps businesses recover lost income during unexpected disruptions. 

Does Chemist Warehouse dispense medicinal cannabis? 

Chemist Warehouse has engaged in ventures to supply medicinal cannabis products. In 2018, it began dispensing Bod Australia's MediCabilis cannabis oil nationwide.  

In 2023, Chemist Warehouse entered a joint venture with Wellnex Life to launch medicinal cannabis products under a jointly-owned brand. However, availability may vary by location and product. 

What are the laws for cannabis possession in Queensland? 

In Queensland, possessing cannabis is illegal under section 9 of the Drugs Misuse Act 1986. Penalties vary based on the amount found: 

• less than 500 grams or 100 plants: up to 15 years imprisonment 
• more than 500 grams or 100 plants: up to 20 years imprisonment 

How many cannabis plants can you have in QLD? 

Cultivating any number of cannabis plants without proper licensing is illegal in Queensland.  

What is the 3-Strike Rule in QLD? 

Queensland operates a 'three-strike' policy for minor drug offences.  

1. first offence: offenders caught with small amounts of drugs for personal use receive a warning 
2. second offence: offenders are offered a drug diversion assessment program 
3. third offence: offenders are again offered a drug diversion assessment program 

If caught a fourth time, the individual may face criminal charges and court proceedings. 

How does cannabis properties insurance help protect clients? 

Below are scenario-based examples showing how this insurance supports businesses: 

• fire damage recovery: insurance covers facility repairs and crop losses after a fire 
• product liability protection: insurance handles legal costs and settlements for faulty CBD products 
• theft compensation: insurance reimburses the value of stolen inventory 

Cannabis properties insurance mitigates financial risks from unforeseen events, ensuring stability and compliance for businesses in Australia’s cannabis industry.