MicroBrewr 065: Finding the right small business insurance for a brewery

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Moores Insurance Management, in St Paul, Minnesota is an independent insurance agency. They’re not an insurance company; instead they act as an advocate for small businesses, to assess risk and help pick the best insurance plan for your situation.

Jack Moores has been working in the industry for 5 years. He’s the risk advisor for the agency that his father heads. They specialize in finding the right insurance for craft breweries.

Insurance categories that a brewery likely needs:

Property insurance – For the building and the brewing equipment.
General liability – For third-party claims against your brewery such as “slips, trips, and falls” or other “allegations of negligence.”
Workers compensation – If an employee becomes injured or ill while working on the job.
Liquor liability – For claims concerning “over-served patrons.” Also covers your defense costs, which could come in handy in the event of frivolous lawsuits.

So how much will insurance cost for your brewery? Plan on budgeting about $5,000 to $10,000 annually for all insurance needs.

Keep in mind that cost of premiums can vary widely based many factors including:

Location
Property value
Amount of equipment
Square footage of the building
Projected revenue
Percent of beer sold on-site
Amount and type of live music

Additionally, businesses are rated based on “loss experience” and judged against other businesses in the same industry. Basically, if you have more claims than other breweries, you rates can go up. This is especially important in terms of workers compensation insurance.

“Haste leads to accidents…” says Jack. “Safety and prevention of claims really pays off because workers compensation constitutes close to half of a brewery’s total insurance program.”

Craft breweries experience twice as many claims for workers compensation than their macro brewery counterparts. And many of the risks present in the brewing environment are unique to the industry.

“The brewing business is a unique enough exposure that it warrants specialized coverages,” explains Jack. “A standard commercial insurance policy slapped onto a brewery is really going to leave some pretty significant gaps [in coverage.]”

Other insurance coverage that a brewery should consider:

Product recall
Employment practices
Beer spillage
Tank leakage
Refrigeration coverage

“The cost isn’t necessarily more, it’s just coverages that are tailored toward breweries,” explains jack

The main thing is to be proactive in managing your risk. Don’t think of insurance as a chore that just needs to be done, so find the least expensive plan.

“You have a product that you love, it’s dream job. I really don’t think it makes sense to jeopardize all of that just to save a few dollars on insurance.”

“Haste leads to accidents… Safety and prevention of claims really pays off.” [Tweet This]

Listener question:

If you could ask one question to every brewer or brewery owner, what would you ask? Let me know.

Book recommendation:

Purple Cow, New Edition: Transform Your Business by Being Remarkable–Includes new bonus chapter by Seth Godin.

Check out the entire list of recommended books, click here.

An upcoming beer style:

Sour beer

Other resources:

Boston Beer Settles Dispute With Former Glass Bottle Supplier, The Boston Beer Company, May 10, 2011.
Serving Alcohol, Beer Exam School, November 1, 2014.
Craft Beverage Program, Moores Insurance Management, Inc.
Trampled By Turtles band from Duluth Minnestoa in iTunes.
Summit Brewing Company, St Paul, Minnesota.
Allied Trade members, your local craft brewers guild.
Allied Trade Members, Brewers Association.
MicroBrewr 057: Create new revenue streams for your brewpub, MicroBrewr, March 31, 2015.
Strange Brew in iTunes.