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How Workers' Compensation Insurance Benefits Cannabis Businesses

As a cannabis business owner there are certain responsibilities and requirements that cannot be avoided. One requirement that causes trouble for some employers is Workers' Compensation. Most states require employers to carry Workers' Compensation insurance with few exceptions other than number of employees. States vary on the number of employees any employer must have before carrying Workers' Compensation but it can be as few as five or even one employee. While on the surface carrying workers' compensation can seem like an unnecessary burden for the employer, it is important to recognize the benefits of the coverage.

Workers' Compensation insurance and coverage is designed to protect the employer in instances where an employee gets hurt on the job. If this coverage were not mandated or not available to employers, businesses would be at risk for law suits with every employee that walked through the door. Whether you are a start up cannabis dispensary, or a large manufacturer of cannabis goods, a single law suit could ruin your business in the blink of an eye.

Even if a business is successful in defending against an employee law suit, they would have spent thousands of dollars in court and legal fees to do so. If they were to lose the case they would have those same fees, plus the cost of damages, and in some instances they may also have to pay the legal fees of the employee! Now imagine that scenario but add in the fact that if you don’t have workers compensation insurance in a state where it’s required, you can also be fined, even see your business possibly temporarily shut down until the matter is resolved.

Another benefit to Workers' Compensation insurance whether for traditional employers or for the cannabis industry is that its is monitored by state governments. The full benefit of this fact may vary among states but state governments look to balance the rights of the worker with the costs to the employer. Employers will always want to spend less and employees will always want more, but states try their best to be a neutral arbiter when crafting laws and legislation dealing with Workers' Compensation.


S2S Insurance Specialists insures the most difficult risks facing your company. We have the top carriers for Workers’ Compensation Insurance for the cannabis industry, and we will customize a policy that meets your operational needs and budget. To learn more about how we can protect you your business, email or click here schedule a free 15-minute consultation or call us at (954) 790-6604.


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