Epic introduces pollution liability insurance for cannabis industry

Epic Insurance Brokers & Consultants has announced the nation’s first program for site pollution liability insurance or the nascent legal cannabis industry. The Epic/Greyling Cannabis Site Pollution Liability (CSPL) program comes via Epic’s Greyling Insurance Brokerage & Risk Consulting business.

The program will be available in all states where recreational and medical cannabis is legal. It will offer businesses a solution to an existing gap between general and excess liability insurance, which do not cover losses stemming from “pollution/pollutants on, at, under, or emanating from an insured location.”

Through the CSPL program, which offers annual policies with premiums from $4,000, cannabis growers, processors, and retail outlets will also be protected from claims alleging third-party bodily injury, property damage, and corrective action costs such as incident investigation and cleanup.

Cannabis growers, Epic claims, could potentially be at risk of pollution damage from fertilizers and chemicals used in both indoor and outdoor grow operations. Chemicals such as ethanol are used to produce cannabis oils and CBD products, and hold the potential to damage processor businesses. Retail outlets, meanwhile, can potentially be exposed to pollution from heating and cooling systems within buildings – or via maintenance or nearby construction projects. Landlords often require tenants to maintain some form of pollution liability insurance.   

The CSPL program in particular will provide businesses with coverage that includes coverage for civil fines or penalties caused by a pollution condition; coverage for natural resource damage; mitigation expenses coverage for costs arising within seven days of a pollution incident; and terrorism coverage.

The cannabis industry is rife with opportunity for consultancies around the United States. In mid-July, professional services firm Manatt, Phelps & Phillips launched a cannabis consulting practice to offer legal and business counsel on cannabis and CBD issues. Additionally, a 2018 A.T. Kearney study showed that a vast majority of consumers are open to trying legal cannabis therapeutic products.

Epic employs more than 2,600 people and operates out of more than 70 offices in the US. It offers property and casualty, employee benefits, specialty programs, and private client services. The firm reports revenue of more than $730 million and is backed by Oak Hill Capital Partners.