How Growing Cannabis Might Affect Your Home Insurance
It’s been two years now since it has been legal to grow up to four cannabis plants per residence for personal use in Canada. This year’s outdoor growing season may have come to an end here in Southwestern Ontario, but if you plan to grow cannabis at home indoors through the winter, or outdoors next season, it’s only prudent to consider how your new growing efforts might impact your home insurance.
Having language written into your home insurance policy that excludes certain risks is nothing new. Obviously, losses related to illegal drugs has never been covered. But in some cases, your policy might also, by default, include language that excludes growing marijuana, even though doing so may not be illegal any longer. Insurance companies are still charting relatively new territory here, and getting a handle on what the added risks of growing cannabis at home may be.
So, when it comes to growing marijuana for personal recreational use as allowed by law, policies may vary widely from insurance company to insurance company.
Risks of Growing Marijuana at Home
Growing marijuana indoors for instance simply isn’t perceived by insurance companies to be the same as growing any other house plant. There are unique risks to the process that include the increased potential from electrical fires caused by grow lights, the added possibility of water or mold damage, and even the increased possibility of personal liability claims caused by someone consuming marijuana on the premises. As well, there’s even the chance your crop increases your odds of being targeted by thieves.
How Growing Cannabis Could Void Your Insurance
Consider the case of a homeowner who lost a court battle following a fire in one of his outbuildings. The court ruled that while the outbuilding had been added to the homeowner’s policy, the insurance company was not informed that the building was being used to grow more than 300 marijuana plants (legally with a licence).
Because the insurance company was not informed what the building was being used for, it was ruled that they had not been made aware of the added risks involved, as would have been apparent had the policy holder been transparent about his intentions for the building.
Read All of the Fine Print
With this kind of precedent now set, it only makes sense for homeowners intending to grow any amount of cannabis to carefully review their home insurance policy and understand any language specific to marijuana or cannabis cultivation.
Beyond growing just the number of plants that is legal, it’s important to make sure you understand the laws in your own province, since not all provinces and territories have the same rules. If you grow more than the legal limit, or break any other law associated with cannabis production, that could result in a basis for denying a claim or voiding your policy.
Don’t hold back on facts
Since this is all relatively new, and cannabis growing and use has a far broader social scope than many people might realize, don’t be surprised if you are asked questions about growing marijuana when you are applying for a new home insurance policy or when it comes time to renew. There is no reason not to answer honestly, except that failure to disclose the presence of marijuana plants, even within the legal limit, could cause you problems in the future.
Generally speaking, as long as you are growing cannabis within the legal limit and not using any prohibited equipment, your coverage may not be affected at all. Every situation and every policy is different, so simply confirm with your insurance company that you are covered if you decided to grow cannabis.
Insurance companies are still determining everything to be considered underwriting the risks associated with growing cannabis at home. As time goes on these policies will likely become more standardized, but until then it is strongly recommended to disclose your plants and verify that your grow-op doesn’t void your insurance.