As of last year, there are 9,000 breweries in the United States. Running a brewery is rewarding but it can also be stressful, especially in the craft brewery industry. One of the things you do not want to have to worry about, however, is your brewery's insurance.
But how can you be certain you have the insurance you need? Here are four things you need to know about brewery insurance.
1. Brewery Industry: Who Needs Insurance
The Brewery Association defines a brewery as a "small and independent brewer", which encompasses everything from microbreweries, taproom breweries, brewpubs, contract brewing companies, and more.
The type of insurance you need will depend on many factors, including whether or not you serve food and beer, how many locations you have, if you sell wholesale, if you offer tours, and much more.
2. Types of Brewery Insurance
Brewing beer has many risks you need to prepare for. The kind of insurance you need will depend on the kind of brewery you run.
Business Property Coverage
This kind of insurance protects the actual building where your brewery is located and everything in it you use for your business. It can protect you against fires, weather damage, and theft.
You want to be sure that your business property coverage also includes coverage if your business is interrupted, like when you have to relocate. If your business cannot function, business property insurance will cover your losses.
Employment Practices Liability
If an employee sues you and claims discriminatory behavior, this insurance will cover you. You want to be sure of what the insurance covers since there can be variations.
Workers' Compensation Coverage
If employees get injured or sick on the job, this insurance will cover lost wages and medical costs. Without this kind of insurance, most states will not allow you to operate if you have any non-owner employees.
Having this kind of insurance will protect you from any injuries or illnesses employees sustain at work.
Equipment Breakage Coverage
Your craft brewery depends on having fully functional equipment. If a piece of equipment is not working as it should be or is damaged in any way, equipment breakage insurance will cover it.
Small breweries do not have backup equipment, so a malfunction in any piece of it can create costs and loss of revenue. With insurance that covers this, you do not have to worry about your production stopping.
It covers repairs and replacements of all manner of equipment. Do choose equipment coverage that covers inspections as well as offering a maintenance program to help prevent equipment breakdowns.
Tank Collapse and Spillage
Having a tank that leaks, spills, or collapses can mean serious losses in revenue. Insurance that is specific to that can ensure you get coverage for any loss of beer or water.
Product Contamination Coverage
If you have losses from a power outage that spoils the products, this insurance type will cover it. If the product gets contaminated in any way and you are able to catch it before it goes to market, you will lose all of that revenue as well as the materials you used for the brew.
With product contamination and spillage coverage, you can get coverage for those losses.
Liquor Liability Insurance
Any business that sells, distributes, or manufactures alcoholic beverages of any kind need what is sometimes called "dram shop insurance". It will protect you against any events that happen because of intoxication.
Product Recall Insurance
If you need to recall products, you want to have coverage of these losses. You also want coverage if you need to hire anyone to defend your brand, like a public relations agency.
Product recall insurance will cover the costs of having to let your customers know of a recall, overtime for your employees, and the transportation of the returned products. Public Relations Expense Reimbursement is an add-on that can cover press releases.
3. Additional Coverage to Consider
There are other insurance options you can add to protect your business from potential issues. When considering other coverage options for your brewery, there are some important options.
Business Auto Coverage
If you lease, borrow, or purchase vehicles for the brewery, business auto coverage will insure them. Vehicles like logistical vans, trucks, and other vehicles get coverage.
Inland marine coverage protects your products while on their way to other locations, by land or by sea. It can be important to know about the details of this coverage to ensure all of your products are protected.
Business Cyber Insurance
Most breweries use a computer system. If you suffer damages to this system, get hacked, or anything similar, cyber security coverage can protect you.
If your brewery also operates as a restaurant, you will have added liabilities you want to be prepared for. This type of insurance usually includes sewage backup coverage, electronic data processing (EDP) coverage, utility interruption coverage, as well as peak season coverage.
An additional option you want to consider is employee theft coverage, which will protect you if employees steal from your brewery.
4. Protecting Your Brewer
The key employee in any brewery is your brewer. There are insurance coverage options that protect your business if you have to replace the brewer.
You can choose to have a specialized endorsement within your policy Key Employee Replacement Expense. It will cover the replacement of the brewer if they are injured or killed in an incident your insurance covers.
Keep Your Brewery Safe
The brewery industry is a complex and competitive one. Make it a bit easier by making certain your brewery insurance covers every potential issue. Protect yourself, your workers, and your investment with the proper insurance.
Contact us to find your insurance solutions!