Avoid Costly Cannabis Recalls With These Tips

Nov 1, 2022

Those of us working in the cannabis industry remember last year’s recall in Michigan. The cannabis recall was the largest in the state’s history, costing over 400 dispensaries nearly $200 million worth of product. 

But recalls can exact a toll beyond just lost product. In response to recalls, cannabis businesses are faced with costs related to pulling product off shelves, issuing refunds, managing public relations, and paying for possible legal fees. These immediate costs don’t take into account losses in future revenue from a damaged reputation and erosion of trust, which can be crippling for a business. 

Based on lessons learned from the 2021 Michigan recall, these are three things cannabis businesses can do to avoid costly recalls:

  • Manage the product supply chain carefully. Keep a careful eye on each step of the supply chain from growers to contract manufacturers. Even if your business maintains strict manufacturing guidelines, you can’t always count on partner suppliers and contract manufacturers to uphold the same standards.  
  • Ensure proper product testing. Contamination can happen at any point in the production and handling process. A portion of a batch may pass product testing, but that doesn’t necessarily mean the entire batch is safe. Businesses need to take preventive measures and test at different stages of production, as well as test finished products.  
  • Maintain open communication channels with the health department. Each state regulates cannabis differently. Cannabis retailers and testing labs should consider how they can work alongside their state’s health department to put reasonable guidelines in place that protect both consumers and businesses.  

Want to hear more? Read the full article at MJBizDaily. 

Despite mitigation efforts, the reality is that recalls are a risk for any industry, which is why proper insurance is key for peace of mind.  

Searching for the right coverage for your client? Jencap’s dedicated cannabis specialists are experts in the ever-evolving cannabis industry. Contact us today and take advantage of our broad market access and strong carrier relationships. 

The Jencap Cannabis Insurance Team

The Jencap Cannabis Insurance Team

Jencap’s cannabis experts thrive on the challenge of difficult-to-place risks. They have boots on the ground in every major cannabis market and fully understand the unique challenges of both single-state and multi-state cannabis businesses in this budding industry. Our top-of-the-crop cannabis team offers fully-customized, winning insurance solutions that span every class of cannabis business and ancillary services — from the farm to the shelf and everything in between.
cannabis insurance | recalls | tips



Jencap Cannabis Insurance Insights

Preparing for the Future of Cannabis Insurance

Despite the growing acceptance and legalization of cannabis, it remains federally illegal in the United States, creating unique challenges for the industry. Jencap explores three possible future scenarios for federal cannabis reform and their impact on cannabis insurance.


Jencap Professional Lines Insurance

Your Guide to Cannabis Insurance

Marijuana regulations at the state level flip-flop on a weekly basis, making it difficult to keep up. When that happens, a new wave of laws and overturned court opinions will sweep across the country.The only thing changing as quickly as cannabis legislation is the unique insurance needs of this budding industry. We figured you could use a go-to reference for all things cannabis insurance that is current and reliable.





Partnering with a longstanding, specialized wholesaler like Jencap keeps you one step ahead and able to proactively meet your cannabis clients’ needs, even in a complex and ever-changing environment. Managing a cannabis business is challenging enough, but finding adequate insurance coverage shouldn’t be. With Jencap’s unmatched reputation and market clout, you’ll have access to a national network of non-admitted and A-rated cannabis carriers. You can rest easy knowing you’re working alongside experts who adeptly cut through the messy tangle of regulations and policy forms to find the coverage your clients need.

Stay Informed

Want to receive information from Jencap on timely marketplace trends, hot new product and program launches, and valuable product expertise that will set you up to win? Sign up below to receive email communications from Jencap.

This field is for validation purposes and should be left unchanged.