COVID-19 has changed the landscape for many businesses. The cannabis industry is navigating new realities from the amount of sales to insurance product changes. Industry professionals are keeping a close eye on the market as states walk the line of reopening economies. While there are particular concerns within the industry, there are also some possible upsides. Experts will need to leverage any positive changes to help offset risks as the pandemic continues and while long-term outcomes remain uncertain.
The Cannabis Future and Coronavirus
Dropping sales have hit the recreational cannabis industry, after a brief uptick in sales caused by people hoarding supplies. Declining incomes and closed businesses have further complicated sales. Industry leaders are also worried the legalization process in a number of states that was well underway prior to COVID-19 might be hindered. Liability around vaping is yet another issue based on health concerns that were already problematic.
Professionals are watching changes in cannabis insurance. Coronavirus has caused an avalanche of claims from all types of businesses. Cannabis businesses already have some difficulties in finding good insurance products to meet their needs. This process could become increasingly challenging. Coverage exclusions may multiply in the future. This could cause the loss of many large and small companies, as capital markets tighten the ability to get loans made worse by limited insurance plans.
Potential Positives
There is potentially good news for cannabis companies in the wake of coronavirus. Cannabis is now being recognized as an essential business. States have spoken up to ensure that products are seen as necessary items to the well-being of their citizens. This also has the added benefit of companies being noticed for the important function they play in the economic structure of the country. This could prove to be a key survival point for businesses as their product is further legitimized in this critical time.
While sales have slumped, there are places in the market that have seen increases in sales during the pandemic. It was reported in Illinois that sales were actually up in March. Leaders are encouraged that cannabis companies now being seen as essential businesses that could drive sales and cause more carriers to enter the market. This could have the potential of stabilizing the industry as demand grows.
Find Premium Coverage at Insurance West Inc. Services
It is important to find the best insurance coverage possible for your hemp and cannabis crops. Insurance West are industry experts that understand the importance of protecting the plants you cultivate. For more information about our comprehensive insurance solutions for the cannabis, CBD, and hemp industries, please visit our website at InsuranceForCannabis.com