--- title: "Contract frustration and cannabis business risk | CARMA" description: "Contract frustration is a specialized topic rather than a standard answer for every cannabis business. An initial review should identify the agreement,..." canonical: "https://www.carma365.com/cannabis-insurance/contract-frustration/" --- Insurance by coverage # Contract frustration and cannabis business risk Contract frustration is a specialized topic rather than a standard answer for every cannabis business. An initial review should identify the agreement, counterparty, triggering event, performance obligation, and financial dependency before discussing possible market interest. Prepared by [CARMA Insurance](/about/) Reading time 1 min read Content updated August 12, 2026 Carma Insurance LLC [Business entity NPN 21134854](/licensing-disclosures/) Related CARMA expertise [Zimraan Shikari, Director, Underwriting](/experts/zimraan-shikari/) [How we publish guidance](/editorial-standards/) [Discuss a contract risk](/contact/)[Start QuickQuote](https://broker-forms-sandbox.pages.dev/quoter-v2/) Coverage and availability depend on the account, state, insurer and underwriting review. General information and nonbinding indications do not bind insurance; the applicable binder, policy, endorsements and law govern coverage. Important insurance information This guide is general information and does not determine coverage or legal requirements for your business. Policy terms, exclusions, conditions and available options vary. Contact the appropriate licensed insurance representative about your account, request confirmation of any coverage placed, and review the applicable insurance documents. An application, inquiry or nonbinding indication does not by itself bind or change insurance. Account brief ## What to clarify before discussing this account **Clarify** Which obligation or payment does the business depend on, and for how long? **Confirm** What event is the business concerned about, and which party controls that event? **Prepare** Executed agreement and amendments with party, term, obligation, and termination details [Discuss a contract risk](/contact/) On this page 5 sections On this page [Start with the contract and economic dependency](#start-with-the-contract-and-economic-dependency)[Define the event the business wants addressed](#define-the-event-the-business-wants-addressed)[State questions](#state-questions)[Underwriting focus](#underwriting-focus)[What to send CARMA](#what-to-send) ## Start with the contract and economic dependency Identify the parties, term, obligations, payment structure, termination rights, governing law, and the revenue or cost tied to performance. Explain how the business depends on this particular agreement or counterparty. ## Define the event the business wants addressed Describe the event, interruption, default, or other circumstance of concern without assuming it is insurable. Note existing remedies, contingency plans, alternative suppliers or customers, and any prior dispute. ## Contract questions for an initial review - Which obligation or payment does the business depend on, and for how long? - What event is the business concerned about, and which party controls that event? - What contractual remedies, alternatives, or contingency plans are already available? ## What CARMA wants the submission to explain These details help the team understand the account and identify the next useful question. They do not establish eligibility or available terms. - Describe the contract, performance obligation, counterparty, revenue dependency, and event creating concern. - Explain contractual remedies, replacement options, termination rights, security, and contingency plans already available. - State the requested decision without assuming a specialized product is available or would respond to the event. ## Records for a contract-risk discussion - Executed agreement and amendments with party, term, obligation, and termination details - Financial explanation of the dependency and requested protection - Counterparty information, prior disputes, existing remedies, and contingency plans ## Can CARMA consider this account? CARMA confirms program fit, licensing, state availability, coverage options, and market interest for each account. This guide does not promise eligibility, terms, pricing, or placement. Important insurance and legal information CARMA's website provides general information only. It is not insurance, legal, tax, regulatory, underwriting, safety, risk-management, or claims advice. Nothing on this site is a quote, binder, policy, coverage determination, legal opinion, or promise of eligibility, availability, pricing, terms, limits, or placement. Only an issued policy and its endorsements can provide coverage, and their actual terms, conditions, limitations, and exclusions control. Sending information, following a link, or speaking with CARMA does not bind coverage, change a policy, or create authority to act for an insurer unless an authorized party confirms that authority in writing. Do not rely on this website to report a claim, request a policy change, satisfy a notice requirement, or meet a deadline. Use the instructions in the applicable policy or written communication. Laws, licensing, appetite, carrier participation, and external sources can change, so confirm time-sensitive matters with CARMA, the controlling source, and qualified advisers. [Read the complete website disclaimer](/legal-disclaimer/). [Back to top](#main-content) Continue researching ## Put this subject in the context of the full account. Account-specific review ## Bring CARMA the account. Retail agents, wholesale brokers, and business owners can start with the details they have. [Discuss a contract risk](/contact/)[Start a business insurance conversation](/contact/)