• Deanna Clark-Esposito

Have I Purchased the Right Insurance Policies for My Vapor or CBD Business?

For better or worse, as old as the insurance industry is, it finds it difficult to adjust to offering services to new industries it covers, and the vapor and CBD/hemp industries are no exception.

Increasingly, I’ve heard stories about insurers offering insurance policies with terms that even the insurance broker cannot understand or explain, and it raises the question of, “How can a business owner purchase a policy when it doesn’t even understand the breadth of coverage (presumably) being offered?”

Often times an insurance broker will send over a quote for an insurance policy that lays out some general terms of the insurance to offer along with proposed pricing. Several key pieces of information are missing however, and you as the purchaser of a policy should request additional information to make sense of these missing pieces, including:

1. A glossary of terms (definitions) of the policy terms

2. A copy of a “shell document” of the policy

3. A policy summary document

In addition, you can be sure that there will be several acronyms listed for which no explanation is provided. In some cases it will leave you wondering, "What the heck does that mean?"

When this is the case, go back and ask the insurance broker to give you a list of all of the acronyms contained in the quote together with an explanation of what they mean. They should not expect you to know what they mean (and quite frankly, there’s a good chance the broker himself will not know and will need to go back to the insurance company and ask). At the end of the day, you are the one paying for the policy so you want to make sure you know what coverage you’re paying for, be it for protection of the premises, protection against an allegation of defective goods you may manufacture (e.g., if you manufacture edibles), or otherwise.

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