Specialty coverage for cannabis processors, harvesters, and extractors — hydrocarbon and CO2 extraction equipment scheduling, products liability for ingestibles and concentrates, and contamination claim defense. Subject to underwriting.
Cannabis processing carries some of the highest property and products liability exposures in the industry. Underwriting is strict and policy form details matter.
Hydrocarbon extraction (butane, propane) carries fire and explosion exposure. Carriers require Class 1 Division 1 rated equipment, ventilation, and operator training documentation.
Extracts, edibles, and infused products carry direct consumer exposure. Limits should be sized to annual production volume — not just revenue — because per-unit value is high.
Failed lab tests can trigger product recalls. Recall coverage is often a separate endorsement worth carrying. METRC tracking provides defense documentation.
Extraction workers need specific workers' comp classifications matching the actual exposure level. Mis-classification creates audit and claim issues.
Building, extraction equipment (hydrocarbon, CO2, ethanol), processing equipment, and finished goods inventory — all scheduled at replacement cost.
Coverage for adverse events from concentrates, edibles, vapes, and topicals. Includes ingestibles endorsement that many cannabis GL policies exclude by default.
Costs of recalling and replacing affected lots from the supply chain. Often a separate endorsement above and beyond products liability.
Third-party bodily injury and property damage from operations. Includes pollution liability where applicable to extraction operations.
Coverage for processing workers with appropriate cannabis-extraction class codes. Critical for high-exposure roles.
Lost revenue if a covered loss shuts down processing. Indemnity period sized to reflect actual restart timeline including compliance re-inspection.
All coverage is subject to underwriting. No coverage is bound or altered until confirmed by an authorized Spire representative.
Not always. But it adds new underwriting challenges.
Extraction operations often carry significantly higher underwriting scrutiny because of fire, explosion, equipment, chemical, and products liability exposure.
Insurance carriers typically evaluate:
• Extraction method
• Ventilation systems
• Fire suppression
• SOPs
• Facility design
• Employee training
• Third-party testing
Operations using hydrocarbons generally face different underwriting requirements than solventless operations.
It can if properly structured.
Processing facilities often rely on highly specialized equipment with long replacement timelines.
Equipment breakdown coverage can help address repair or replacement costs, while business interruption coverage may help with lost income during downtime.
Accurate equipment schedules are critical.
Product recalls can create major financial and reputational damage.
Some cannabis insurance programs offer product recall coverage for expenses involving:
• Notification costs
• Product disposal
• Investigation expenses
• Crisis management
• Replacement product costs
Many businesses assume recall coverage is included automatically when it often is not.
Absolutely. If your business manufactures products for other brands, liability disputes can become complex very quickly.
Contracts, indemnification language, labeling responsibilities, testing procedures, and additional insured requirements all matter.
Your insurance program should align with your manufacturing agreements. Learn more about white labeling in our videos with Ryan Kocot.
Many processors undervalue specialized extraction equipment, custom fabrication, or imported systems.
Insurance values should reflect realistic replacement cost, freight, installation, calibration, and potential downtime — not just the original purchase price.
The most common issues include:
• Underinsuring equipment
• Missing product recall coverage
• Incorrect product liability classifications
• Poorly structured business interruption coverage
• Inadequate pollution or contamination protection
• Failing to update values after expansion
Fast-growing cannabis companies often outgrow their insurance program long before they realize it.
Schedule a quick call with a Spire agent. We'll learn your operations and walk you through what coverage looks like for businesses like yours — with no pressure to bind.