Insurer Refusing to Repair Oakland Cannabis Shop: Shop CEO’s Advice


Keith Stephenson’s Oakland cannabis shop, Purple Heart Patient Center, was devastated as the Black Lives Matter protests happened in California. During the weekend of May 29, the shop was ransacked, even after it had been shuttered since March due to the COVID outbreak.

Purple Heart had been shut for around five months, resulting in lost sales they’ll never recover. But now, Stephenson, the founder and CEO of Purple Heart, finds himself fighting with his insurance carrier to get the shop back in order.

Stephenson explained to Marijuana Business Daily that they have not reopened yet; the shop hasn’t operated since March 20, initially because of the pandemic. They were just about to open when the looting occurred. Now, they’re coming up on five months without opening.

Over three months, Stephenson had three adjusters. He explained to his adjusters, “You could either file this claim, or you can file a police report for me filing a false police report. Something’s got to give, because you can tell this is forced entry. Do you think we had anything to do with it?”

He feels that the insurance carrier doesn’t want to pay; this isn’t just about Purple Heart, but the entire industry’s claims. He believes that the adjuster has been dishonest, and since he began cc’ing his attorney on all correspondence, the momentum has changed in the way they’re dealing with this case.

During his experience dealing with his insurance carrier, he has learned it’s crucial to cc an attorney on all correspondence. If the adjuster removes the attorney from the correspondence, Stephenson politely tells them, “Please don’t do that.”

He also advises others in the industry to provide the adjuster with everything they request, even if you don’t feel it’s essential.

The mission here is to have the insurance carrier pay on the claim. So Stephenson advises other cannabusiness operators to keep everything honest; don’t attempt to add to the claim. But also, don’t take anything away from the claim that should be part of it.

Unfortunately, especially in cannabis-related instances, the insurance company is not here to work for you. They’re trying to pay as little as possible to settle your claim, and this means you need to work to get them to pay on your claim.

While Stephenson is confident Purple Heart will open again, he does not know when. So far, he estimates his lost sales, claiming, “It could easily be $4.5 million.”

Have you had any trouble getting a claim processed and paid? What was your experience like?

Louis Levey is the Content Success Manager and Founder at No Strings Content. He's passionate about helping cannabis businesses use content to attract, educate, and convert audiences. His hometown is Boca Raton, Florida, but he currently lives and works remotely in Chiang Mai, Thailand.

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