Common Brewers' Claims- Philadelphia Insurance Companies

Five Common Insurance Claims for Breweries

Every brewery faces unique risks and challenges. A successful brewery will understand those risks and take steps to minimize them.

Without proper risk management and insurance coverage, a brewery could easily be faced with large expenses from equipment failure and lost revenue. Here are five commonly-filed claims to keep in mind when choosing insurance coverage for your business.

1) Equipment Failure

Due to the specialized equipment used in brewing, the risk posed by equipment breakdown can be serious. High pressures can build up throughout the fermentation process, causing storage tanks and vats to break down or even explode if not properly maintained.

Many craft breweries, cideries, and distilleries are small businesses that are already operating on tight budgets. These small-scale facilities rarely have backup equipment readily available in the case of breakdowns, and as a result, equipment failure can cause expenses from lost production time and missed sales, in addition to the cost of repair or replacement of faulty equipment.

When choosing an insurance policy, look for a flexible and customizable product that is tailored to suit the specific needs of your brewery. It is important to have all equipment used in the production of beer, cider, and other craft beverages covered in the event of a breakdown or maintenance issue.

2) Power Outages and Temperature Changes

It's crucial to maintain the proper temperatures throughout the processes of brewing, bottling, and storing craft beverages. Improper temperatures due to power outages or other incidents during the brewing process could cause perishables to spoil, resulting in losses from ingredient waste. Issues during bottling could cause bad seals, resulting in batches of product unfit for sale. Spoilage coverage offers protection against the loss of perishables due to mechanical breakdown or loss of power. Some policies will even evaluate the lost product at market price and reimburse the brewery for the full market valuation.

3) Premises Liability

Many microbreweries and distilleries offer tours of their facilities. Tours can be a great way to show craft beverage enthusiasts how their favorite beverages are prepared. However, brewers can become liable should their guests become injured while on a tour or during other special events.

It is important to not only have special events liability and general liability coverage in case of injury, but to also take advantage of the proper risk management strategies to limit the possibility of accidents. Precautious such as utilizing safety equipment for tour guests and restricting guest access to only the safest parts of the facility can improve safety and minimize accidents.

4) Liquor Liability

Brewers can open themselves up to additional liability by serving alcohol on-site. Offering samples during tours or having an on-site bar all incur potential risks from intoxicated guests. Guests under the influence could damage property or injure themselves or others.

A liquor liability package can help protect against these types of situations. Additionally, look for risk management services that include training for staff to encourage best practices and prevent over-serving.

5) Excess Limits

There may be cases where breweries need more coverage than a standard policy offers. Consider an additional layer of security with an umbrella/excess policy. Essentially, umbrella coverage can pick up where your underlying business auto, general liability, and/or liquor liability coverage stops.

Don't let these five common claims affect your business. The experts at Philadelphia Insurance Companies can help you with an insurance plan that suits your brewery's needs. Fill out our form to be contacted by a PHLY representative.

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