Cannabis Surety Bonds
For many business owners, the fulfillment of their lifelong dream is to actually open the business and run it successfully. There are a great many things that need to be done, paperwork to be completed and filed, and other necessities to be taken care of before the business can even open on day one. The to-do list for any business can be dauntingly lengthy, but those who are truly committed to opening their business are diligent about getting the work done. In the case of a business in the cannabis industry, one of the most important items on the company’s to-do list is to acquire a cannabis license surety bond.
At OG Cannabis Insurance, we are well-versed in every aspect of the cannabis industry, so we understand what is required for you to open a new cannabis business in your area. The cannabis industry is the only industry we work with, so you can rest assured knowing that any question or concern you have can be answered by our experienced agents. Other insurance agencies may claim that they specialize in cannabis industry businesses, you can guarantee that cannabis and CBD are the only companies we work with. We have connections with a multitude of cannabis approved insurance companies and are confident we can find you the insurance policy or surety bond that is right for your business.
Are you opening a cannabis lounge? No problem! Do you have delivery trucks for your products? Easy. Are you a grow or cultivation facility? We got you. Do you operate a laboratory or testing facility? We understand. Is your business a dispensary? We can protect you. No matter what aspect of the cannabis industry you are looking to become a part of, OG Cannabis Insurance is the company you can trust to protect your business’s best interests and set you up with an insurance policy or surety bond that works the best for you.
What Are Cannabis Surety Bonds?
A surety bond is a financial instrument that binds three parties together: principal, obligee, and surety. The principal is the business or individual (you or your company) who maintains the bond, and a credit check and/or collateral is generally required. An agency (usually a government group from the state, city, or county) is the group which requires the principal to purchase the bond. Finally, the surety is the agency or company that issues the bond and backs the principal of the bond.
Essentially, the surety bond guarantees to the obligee that you and your company will meet the requirements that have been set down in the agreement. The bond, unlike insurance, protects the third party in the agreement in case something happens where you cannot meet the obligations of the bond. If the requirements cannot be met, the bond will compensate the third party for any losses that may be incurred and sought after in a claim.
How Do Cannabis Surety Bonds Work?
Once you have secured the surety bond in order to get your cannabis business license, it is up to you to make sure that the investment made by the bonding company is worth it and you do not break the agreement that was signed. A failure to live up to this bond could result in a claim being filed against you and your company, and, if shown to be true, the surety will have to pay out the amount of the bond that was claimed in the suit.
There are three entities involved in every surety bond, and your cannabis-related business will need to understand how these bonds function with your company. The obligee (usually from the government) uses the surety bond as a form of regulation and requires you (the principal) to secure the bond to get a license. The surety, then, is the bonding company that takes the risk by backing the bond. All of these entities must work together and come to an agreement in order to secure the bond and then get the license needed to open your cannabis or CBD-related company. If any of this is confusing, OG Cannabis Insurance is here to help you work through it all.
Surety bonds are not the same as insurance policies, but they are quite similar in nature when it comes to protection and coverage. Insurance policies provide coverage if claims are made against your company and will cover the costs of defense, possible payouts, and other related expenses. Surety bonds, on the other hand, are more of a financial guarantee or a loan on the quality of your work and the viability of your cannabis business.
How Surety Bonds Are Helping to Cover Cannabis Businesses
When you are starting a cannabis business of any kind, it is essential and may be required to have a surety bond backing your company. Whether you have a cannabis lounge, dispensary, grow facility, or any other cannabis or CBD-related business, you will need to have the protection of a surety bond. The primary reason is to ensure that third parties involved in your businesses are secured in their investments and can be covered for any losses caused by your company’s failure to meet the requirements of the bond.
Contact OG Cannabis Insurance Today
At OG Cannabis Insurance, we have over 18 years of insurance experience in the cannabis industry, and we are dedicated to making sure that your grow facility, dispensary, laboratory, lounge, or any other cannabis-related business is secured by proper insurance coverage and that you understand the requirements of your surety bond. We offer the fastest quotes in the industry and access to multiple cannabis approved companies.
Your company will be assigned to a specific, dedicated insurance agent/broker, so you will always know who to contact when you have a question or concern that needs to be addressed. Our policy quotes are fast and easy to understand, so you can get the coverage you need quickly and efficiently. Contact us today to learn more about our cannabis business surety bonds and to receive a free quote from our experienced agents.
We provide coverage for cannabis businesses across the United States, including: