Canopius Group Begins Insuring Cannabis Companies Against Cyberattacks
International insurance provider Canopius Group has started offering cyberattack insurance to legal American cannabis companies. The organization is one of the few insurers willing to provide services to the cannabis industry.
Producers Can Now Cover Losses from Hacker Attacks
The cannabis sector in the U.S. relies heavily on information technology, making it vulnerable to cyberattacks. In response, Canopius has developed a specialized insurance product for the cannabis industry. Policyholders can receive compensation of up to $25 million for losses resulting from various incidents, such as:
- Hacking of digital platforms
- Ransomware infections
- Cyberattacks on networks
- Data breaches
Canopius offers cyberattack insurance to all participants in the cannabis supply chain, including growers, transportation companies, processing plants, and retail stores. Technology companies that develop software for cannabis businesses are also eligible for coverage.
The Canopius policy also covers expenses related to fines, helping organizations resolve disputes with clients and government agencies in the event of a data breach. If criminal activity results in property damage, the insurance will cover the cost of the loss.
One notable example of a successful cyberattack in the cannabis industry was the December 2020 breach of Canadian producer Aurora Cannabis. Hackers accessed employees’ personal information, including bank card numbers and addresses.
Canopius Expands Coverage for Cannabis-Related Risks
In April 2023, Canopius expanded its product lineup to include insurance against civil liability risks for private and non-profit organizations involved with cannabis. This coverage includes costs arising from incidents such as safety violations at cannabis processing plants or the loss of cannabinoid products during transportation.
Canopius has not disclosed the average cost of its services. However, based on the situation in Colorado, not all cannabis companies can afford insurance. For example, when a grasshopper infestation destroyed cannabis crops in the state, it was revealed that many growers had not insured their plants. The insects wiped out nearly entire harvests on some farms, leaving owners on the brink of bankruptcy.
Photo: Humble Farms cannabis farm after the grasshopper infestation
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