Excess Premium

In the cannabis industry, excess premium refers to the additional cost a business pays for an excess insurance policy—also known as an umbrella policy. This type of coverage sits on top of a primary insurance policy and provides extra liability protection once the limits of the primary policy have been exhausted

Why It Matters
In captive insurance structures, excess premium may be retained, invested, or distributed to members rather than lost to a carrier.

Example
If claims are lower than expected, excess premium accumulates as retained capital.