Commercial general liability insurance means what? 

Commercial General Liability insurance (“CGL”) is a type of business insurance protection or coverage for medical and recreational marijuana businesses caused by a third party. 

  • Your business is being sued by someone who was harmed or injured.
  • The lawsuit against your business claims they were injured.  The injury could be physical damages to a human being or their property. 
  • Insurance provides the resources (money) to protect your company, if a claim or laws is filed.

What types of claims are covered on a commercial general liability policy?

Typically, these policies provide coverage for accidents related to your business location from where you operate the company.  A simple example is when a customer visits your facility and slips on the stairs or ice.  This is also known as a “slip and fall.”  However, there may claims associated with unintentional copyright or trademark infringements or personal injury.  Most policies of this nature will offer a legal duty of defense.  Depending on the lawsuit, the insurance carrier will need to provide coverage for your legal costs in order to defend a claim or lawsuit.

  • Think of accident at your business location.  Not intentional or acts of god. 
  • Remember, the insurance carrier may provide legal assistance to your business if you’re sued.

How much does commercial liability insurance cost?

Depends on different factors.  Most insurance carrier price your liability insurance on revenue, square footage, and type of business such as dispensary, grower, or manufacturer.

You can visit our insurance price calculator to get a rough estimate of cost of insurance.

Example Insurance Coverages and Terms

Name of CoverageSample Limits Other Important ProvisionsSummary of Key Policy Terms.

Please Note: Insurance policies issued by different carriers may have modified terms as depicted in this sample below. User should review and rely on their own policy language for further accuracy or clarity.

General Aggregate$2,000,000Deductible 0Aggregate limits is the carriers way of limiting the total amount being paid on the policy as a result of different lines of insurance being utilized.

Using this example quote, the maximum sum of what will be paid for medical expense is $5,000, Coverage A of $1,000,000, and Coverage B of $1,000,000. The example of $2,000,000 would be met if both Coverage A and B were fully paid on a claim.
Products and Completed OperationsEXCLUDEDProducts and Completed Operations is liability coverage for the product entering the stream of commerce resulting in a claim or lawsuit. This coverage is typically excluded in most Commercial General Liability policies in the cannabis industry.

Products and Completed Operations means Includes all "bodily injury" and "property damage" occurring away from premises you own or rent and arising out of "your product" or "your work".... The quotes reference in the insurance policy the term is further defined.

Your product means (1) Any goods or products, other than real property, manufactured, sold, handled, distributed or disposed of by.....:

Learn More about Product Liability Insurance
Each Occurrence$1,000,000Deductible 0The amount of coverage for each occurrence defined in most insurance policies as means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
Personal and Advertising Injury$1,000,000Deductible 0This coverage offers Third party liability protection for Personal and Adverting Injury. This term is typically defined as

a. False arrest, detention or imprisonment;
b. Malicious prosecution;
c. The wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that a person occupies, committed by or on behalf of its owner, landlord or lessor;
d. Oral or written publication, in any manner, of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services;
e. Oral or written publication, in any manner, of material that violates a person's right of privacy;
f. The use of another's advertising idea in your "advertisement"; or
g. Infringing upon another's copyright, trade dress or slogan in your "advertisement".

This coverage is subject to a variety of exclusions that either remove or modify the definition based on intent or false statements. There have been a variety of lawsuits in the cannabis industry involving copyright infringement.
Damage to Premises Rented to you Limit (any one premises)$300,000Deductible 0Liability coverage for the damage to the actual business location rented to the cannabis licensee. Typically, the building insurance for the landlord acts as the primary form of building insurance. Depending on the circumstance this coverage may provide additional building coverage.
Medical Payments $5,000Deductible 0Medical payments paid regardless of fault for bodily injury.
(08/17) Commercial General Liability Declarations
(12/07) Commercial General Liability Coverage Part
(03/05) Exclusion-New Entities
(12/07) Employment-Related Practices Exclusion
(09/99) Total Pollution Exclusion
(08/17) Combination General Liability Endorsement
(08/17) Assault and/or Battery Exclusion
(08/17) Fines, Penalties, Punitive of Exemplary Damages
(11/85) Exclusion-Products/Completed Operations Hazard
(08/17) Audit Premium Amendatory Endorsement
(08/17) Exclusion-Sexual Abuse or Molestation
(08/17) Exclusion-Total Liquor
(08/17) Exclusion-Professional Liability
(03/05) Silica or Silica Related Dust Exclusion
(07/98) Limitation of Coverage to Designated Premises
(08/17) Exclusion-Residential Occupancy
(08/17) Waiver of Transfer of Rights of Recovery Against Others to Us
(08/17) Commercial Lines Common Policy Declarations
(08/17) Schedule of Forms and Endorsements
(08/17) Claims Notification
(08/17) General Clauses Endorsement
(08/17) Applicable Law (U.S.A.) Clause
(08/17) Privacy Policy Statement
(08/17) Sanction Limitation and Exclusion Clause
(08/17) Minimum Earned Premium Endorsement
(08/17) Mold and Fungus Exclusion
(08/17) U.S. T.R.I.A. of 2002 as amended-Not Purchased
(05/04) Nuclear Energy Liability Exclusion Endorsement
(11/98) Common Policy Conditions

Sample documents included in a Commercial General Liability insurance policy. The construction of a policy is based on standardized forms. The Commercial General Liability Coverage document is primary. The additional documents are exclusions or endorsements that modify the terms of the policy.