Why Cannabis Lab Testing Insurance Matters

As cannabis and CBD oil become more mainstream due to legalization in states across the country, it is important that consumers know what they are consuming. Cannabis lab testing allows for wholesalers, retailers, and the end consumer to trust that what they are selling/buying is what they believe it to be. The cannabis and CBD market is new and growing with increased competition everyday, so it is important that the consumer knows how to distinguish the good from the bad. If you are a person looking for just CBD oil, which lacks the THC or the psycho-active component of cannabis, you do not want to end up with something that has more THC than anticipated. Same goes for someone looking for a product containing THC, you do not want something missing the main ingredient. Cannabis lab testing helps to prevent those types of mistakes from happening, among others.

When searching for a CBD or cannabis product, consumers should look for products that have been tested by a third party and not just the company selling it to the consumer. Independent testing companies stake their reputations on each test they produce, so they have no reason to be biased toward manufactures. The job of the third party cannabis lab testing facility is to identify the purity, potency, and other data points to ensure the product is safe for consumption.

Most states have requirements for lab testing of all cannabis and CBD products, but these regulations and requirements vary state to state. Cannabinoid potency data quantifies levels of plant cannabinoids present in cannabis products. Producers are required to obtain potency data for THC and CBD, the two most common cannabinoids. It’s important for consumers to know THC and CBD levels because these will have a strong influence on the effects of the product. For example, some medical patients may want a strain with a high CBD: THC ratio, while adult-use consumers may request the opposite.

According to Confidence Analytics, a state-certified laboratory in Washington, “there are no strong regulations in place about how cannabis chemicals are measured. However, HPLC has emerged as the dominant technique for measuring cannabinoids.” In other industries, there are specific guidelines on testing methods and settings for laboratory equipment.

This lack of regulation can lead to discrepancies in potency data and inaccurate cannabinoid data. States are pushing to standardize cannabis testing and ensure that potency values are consistent across laboratories. In Washington state, a group of I-502 accredited laboratories are undergoing a “round robin,” measuring the potency of an unknown cannabis sample and comparing the results between laboratories. If proper testing practices are in place at each laboratory, reported potency data should be similar across the board.


Cannabis labs are no different than any other branch of the cannabis business and need specialized insurance that covers the lab in case of product liability claims, for example. Cannabis is a Schedule I drug in the US and often can prevent insured business owners from collecting if they don’t have the right policy. To learn more, contact Eric Rahn at eric@s2sinsurance.com or click here to schedule a free 15-minute consultation.