The craft brewing industry is booming, with more people enjoying local brews. Yet, running a brew pub successfully means facing special risks. Knowing what influences your insurance cost is key to protecting your business without overspending1.
The kind of brew pub you have, how much beer you sell, the worth of what you own, the building’s size and where it is, plus the workers you have and the risks you face, all play a role in your insurance price. A skilled insurance agent who knows about the brewing business can guide you. They’ll help you find the best insurance for the best price2.
Key Takeaways
- Craft breweries and brew pubs need more than basic insurance. They should consider coverages like for tank issues, machinery breakdowns, and product problems3.
- The amount of beer sold, what your stuff is worth, how big and where your place is, your team’s size, and your business’s past can all change what you pay for insurance.
- Being careful about risks can keep bigger problems, like being sued over drinks or workers getting hurt, from happening. This can keep your insurance costs lower3.
- Choosing insurance companies that see the unique risks of breweries can ensure you get good coverage at a good price3.
- After COVID-19, breweries may save money on workers’ comp if they had employees on a break1.
Introduction to Brew Pub Insurance
The craft brewery industry in the U.S. has grown a lot lately. Now, small and independent breweries make up over 13% of all beer sold in the country4. They stand out for their authentic, community-focused approach and unique beer types. Brew pubs, specifically, are places that make and sell their own beer, often with a restaurant4. But, running a brewery or pub means facing specific challenges. That’s why they need special brew pub insurance.
Overview of the Craft Brewery Industry
The craft beer scene has really taken off. Canada now has over 200 breweries, mostly small ones and brew pubs4. As the love for craft beer grows, so does the need for insurance for brew pubs and others in the industry.
Importance of Insurance for Brew Pubs
For brew pubs, having the right insurance is key. It helps protect your business, handle risks, and ensures you can keep running after unexpected events4. Brew pubs and microbreweries, among others, face specific risks. These include costs from business interruptions, event liabilities, contamination, and recalls. Knowing what affects your insurance cost is important for getting good coverage without overpaying.
“Craft brewers have unique risks that may include business interruptions due to equipment breakdown, special events liability, contamination costs, and product recalls.”5
Type of Brew Pub
The craft brewery world is a big one, with many unique spots that need their own special insurance6. These places, like craft breweries and distilleries, need insurance to protect against different risks, such as property harm or liability lawsuits6. The Brewers Association breaks them down into groups like microbreweries, brewpubs, and others.
Microbreweries produce under 15,000 barrels yearly and mostly sell off-site6. Brewpubs are like restaurants that brew their own beer, selling a big part on-site and serving food6. Taproom breweries sell at least 25% on-site without the food part. Then there are regional breweries and more.
The type of brew pub matters a lot in figuring out the right insurance and what you’ll pay6. For instance, nanobreweries might pay very low, around a few hundred bucks, while microbreweries expect to pay £1000 or more7. Looking over insurance options often can save you 15-20%7.
Knowing the different brew pub types and what makes each special is vital. This knowledge helps breweries and distilleries get the coverage they need6. Things like dealing with claims, property issues, and safety plus following rules all affect the insurance a place needs6.
Brew Pub Insurance Premiums
When talking about Brew Pub Insurance Premiums, many things can change the costs of your coverage. Knowing these factors can help you make smart choices and improve your Brew Pub Insurance Rates. This is key to protecting your craft brewery8.
The first thing to check is the type of brew pub you have. Microbrewery insurance usually includes different coverages to meet brewery needs. This can be more budget-friendly than buying each coverage alone. You might get General Liability, Business Property, Business Interruption, and other types fit for your pub8.
Next, consider how much alcohol you sell. If you sell a lot, it might mean higher risks and, thus, higher premiums. This risk level is carefully looked at by insurance companies when they set your rates4.
How valuable your assets are also matters. This includes your equipment, property, and stock. The more your assets are worth, the more coverage you might need, pushing up your premiums7.
Also, the size and spot of your brew pub can up your insurance costs. Bigger pubs or ones in risky places might need to pay more to ensure they are fully covered7.
The number of employees you employ could affect your rates too. More staff means there could be more claims for workplace injuries. This can raise what you pay for insurance4.
Lastly, your business history and claims record are big in the eyes of insurance companies. If your pub has run smoothly for a while with few claims, you might get a better deal on premiums4.
Knowing these points about Brew Pub Insurance Premiums can help a lot. You and your insurance agent can then look at ways to get the best coverage at the best price for your brew pub. This information gives you the power to choose wisely and keep your business safe while keeping your insurance costs under control874.
Alcohol Sales Volume
The amount of alcohol a brew pub sells affects its insurance costs. If a lot of their sales come from alcohol, they pose more risk. This is because they might face more legal problems tied to alcohol service and use9. If the alcohol sales are too high, some insurance companies won’t cover them9.
Percentage of Total Sales from Alcohol
Brew pubs need liquor liability coverage. This insurance guards them against claims like over-serving or underage drinking9. If their alcohol sales are high, they’re at more risk and will pay higher insurance premiums9. Most insurers consider a “restaurant” to be where 25%-35% of sales are alcohol, but some allow up to half10.
Risk Associated with Higher Alcohol Sales
Places that sell alcohol, like bars or restaurants, should really think about getting this insurance9. For instance, insurance for a restaurant might cost about $5,000. But for a bar, it could go over $15,00010. If a restaurant turns into a bar, the insurance could jump from $1,000 to over $5,00010. And if a business sells 90% alcohol, its insurance will likely cost more than one selling 60%10.
The price of drinks also plays a part in insurance costs. Places with expensive drinks might have lower risks and pay smaller premiums10. Insurance prices can vary a lot depending on the state’s laws10. Often, businesses need to change their insurance company each year because prices and preferences can differ widely10.
“Liquor liability exposure depends on the type and amount of alcohol served.”11
| Metric | Impact on Liquor Liability Insurance Premiums |
|---|---|
| Alcohol Sales Percentage | Higher alcohol sales percentage leads to higher premiums |
| Alcohol Sales Volume | Higher alcohol sales volume leads to higher premiums |
| Average Drink Price | Higher-priced cocktails may lower premiums compared to cheaper drinks |
| State Liquor Laws | States with patron-friendly “dram shop” laws can result in higher premiums |
Value of Assets
The Brew Pub Asset Value includes the building and equipment. It also has furnishings, inventory, and more. This influences your Commercial Property Insurance cost. Insurance companies look at how much it would cost to fix or replace your items. If your brew pub has fancy or unique stuff, you might pay more. This is because it would cost more to fix or replace them. Having commercial property insurance is key. It helps keep your valuable assets safe. You might also need extra coverage for things like leaks or if your items lose value.
There are over 7,000 craft breweries in the U.S. right now12. Many small ones like breweries, cideries, and distilleries work with small budgets. They might not have extra equipment if something breaks down. The Craft Brewery & Distillery insurance package from Philadelphia Insurance Companies (PHLY) is here to help. It covers the equipment needed to make drinks like beer and cider12. PHLY also has spoilage coverage. This protects you from losing money if ingredients go bad from a power outage or if a machine breaks.
| Coverage | Limit |
|---|---|
| Comprehensive General Liability | $1M per occurrence for premises liability issues12 |
| Liquor Liability | Up to $1M per occurrence and $2M aggregate12 |
| Umbrella/Excess Policy | Can enhance the security of a microbrewery insurance program12 |
When it comes to your brew pub’s Actual Cash Value, insurance companies take a serious look. They use this to figure out your Commercial Property Insurance cost. Knowing your assets’ value and possible repair costs is important. It helps ensure your insurance is enough to protect your business13.
“The typical cost of a small brewery insurance plan ranges from $150 to $200 per month for a standard policy covering $1,000,000/$2,000,000 for liability coverage.”14
Craft breweries are usually strong, even when the economy is shaky14. Working closely with your insurance agent is smart. It lets you make sure your business and its assets are well-protected. Then, your business can thrive in the long run.
Size and Location of the Premises
The size and location of your brew pub matter a lot for insurance costs. Bigger spaces might cost more to insure. This is often due to a higher property risk and cost. Insurance rates can go up based on each 100 square feet of space15.
Your brew pub’s location plays a big part in insurance prices too. Places near the coast or other high-risk areas could have higher premiums15. If you rent your pub, the lease might also require certain insurance levels15.
- Large brew pubs pay more for property insurance because they have more area to insure15.
- Being close to the coast might mean you pay more for insurance because of the added risks15.
- Your lease could dictate the exact amount and type of insurance needed15.
“The size and location of your brew pub’s premises are crucial factors that can significantly impact your insurance premiums.”
Picking the right commercial property insurance is key for your brew pub’s success16. Knowing how your pub’s size and location affect insurance can help. This knowledge lets you make smart choices and find the best insurance deal16.
Number of Employees
If you own a brew pub, how many folks work for you really matters. Especially for your insurance premiums17. The law says that if you have employees, you must have workers’ comp insurance. And, the more employees, the more this insurance will cost you17.
Your brew pub’s safety matters too. More people at work means a higher chance of accidents. So, you might pay more for liability insurance because of this risk17.
Having good insurance is key for brew pubs17. It’s not just about workers’ comp. You need liability too. This keeps your business safe if something happens to your staff17. Don’t forget about health insurance for your team. It makes your brew pub more attractive to good workers and gives your team peace of mind17.
Your insurance costs also depend on how many people work full or part-time18. More employees mean more chances for claims. And this can bump up your insurance prices17. So, manage your staff numbers well. This way, you can keep your brew pub safe and your employees protected17.
| Insurance Type | Relevance to Brew Pub Employees |
|---|---|
| Workers’ Compensation Insurance | Required by law for employers, with costs increasing as the number of employees grows17. |
| Liability Insurance | Covers accidents or incidents involving employees, with higher employee counts leading to increased risk and premiums17. |
| Health Insurance | Provides coverage for your employees, helping to attract and retain talent while managing healthcare costs17. |
“The number of employees can have a significant impact on a brew pub’s insurance costs, particularly when it comes to workers’ compensation, liability coverage, and health insurance. Careful management of staffing levels and comprehensive insurance protection are crucial for the success and sustainability of a brew pub business.”
The amount of employees in your brew pub really changes your insurance costs. Know how your staff affects your insurance choices. This helps make sure your brew pub has the right protection and a good future17.
Business History and Claims Record
Insuring your brew pub heavily weighs on your business history and claims. Insurers carefully look at how long your brew pub has been running. They also check any previous claims or losses. This helps them understand your risk level and decide on the right coverage and rates for you.
Years in Operation
If your brew pub has a long, solid history of running things well with very few claims, you’re in luck. You might get lower insurance rates19. Insurers trust businesses like yours more because you’ve proven your ability to operate without many hitches over the years.
Previous Claims and Losses
On the flip side, if your brew pub has a record of a lot of claims or losses, it’s seen as riskier. This means you might have to pay more for insurance19. Insurers up your premium to cover their likely future costs. Your claim history shapes how they see the risk your pub poses.
Knowing how your business’s history and claims impact your insurance is important. It encourages you to work towards a clean track record. This way, you can possibly get cheaper insurance. And, importantly, protect your business financially in the future19.
Liability Risks
As a brew pub owner, you risk facing events that could hurt your operations and finances20. Brew pubs, part of the craft beer scene, require specific insurance because of their size and how much they produce20. It’s vital to know and handle these risks to safeguard your business and its future.
Liquor liability is a big concern for brew pubs, covered by “dram shop” insurance20. With this coverage, you’re protected from claims about over-serving, underage drinking, or alcohol-related harm. Having this kind of insurance is a must as it deals with legal fees, settlements, and medical costs from these incidents.
Aside from liquor liability, brew pubs also need general coverage for accidents and such21. This can help pay for medical bills, lawyer fees, and potential settlements linked to these events.
Products liability is also key for brew pubs, guarding against claims about bad beer or products20. It pays for product recalls, lost sales, and any lawsuits that might arise.
Brew pubs should aim for at least $1 million in liability coverage22. The actual amount and cost of insurance will change based on your pub’s size, where it is, how much you sell, and your risk history.
Managing these risk areas lets you protect your brew pub from serious financial and legal impacts. This way, you can put your energies into growing your business and keeping your customers happy20.
Over the last 30 years, the U.S. has gone from having fewer than 100 brewers to over 2,400, with the vast majority being craft brewers, microbreweries, or brewpubs. Due to their different sizes and outputs, these establishments have unique insurance needs. The main risk areas for craft breweries are property, equipment breakdowns, supply chain issues, product contamination, and liquor liability. They typically get boiler and machinery, supply chain, spoilage and product recall, and liquor liability insurances21. General Liability Insurance for Breweries covers third-party property harm and personal injury claims. It helps with medical costs, law fees, and settlement payments. Liquor Liability insurance is a must for places that serve alcohol, protecting against damage and injury from negligent alcohol service22. Experts suggest $1 million in liability coverage for brewpubs that serve alcohol. The cost of brewery insurance depends on factors like size, location, beer type, and the coverage and deductible selected.
Insurance Agent and Carrier
Choosing the right Brew Pub Insurance Agent and carrier is key for craft breweries. They need proper coverage at the best prices. Independent Insurance Agents have multiple options, often leading to better deals. Captive Agents usually work with just one company23. An experienced independent agent skilled in the craft brewing field can guide brew pubs through their unique insurance needs. They make sure the right coverage is in place to safeguard their business23.
The Insurance Carrier’s knowledge and standing in the brew pub industry affect coverage quality and cost23. Craft breweries are exposed to distinct risks. These include business stops from equipment failures, liability at special events, and costs from contamination or product recalls5. Teaming up with a brewery-industry-focused Insurance Carrier ensures brew pubs get complete and cost-efficient protection5.
- Insurance costs for breweries change based on what policies are chosen. They also depend on product types, location, how open to the public, food service, tasting rooms, and employee numbers24.
- Different companies offer varying insurance prices, whether they are local or nationally known24.
Working with a skilled Brew Pub Insurance Agent matters. They’re able to look across multiple Insurance Carriers. This ensures brew pubs have the right protective layers. They can manage risks effectively this way23524.
“Partnering with the right Insurance Agent and Carrier can make all the difference in safeguarding your brew pub’s future.”
Conclusion
Having the right brew pub insurance is vital for keeping craft breweries and brew pubs safe25. It’s important to know what affects insurance costs. This includes the size and type of your place25, how much alcohol you sell25, and where you’re located25. Other factors are how big your business is26 and its history25. With this info, brew pub owners can pick the best coverage and save money on their insurance27.
Working with a skilled insurance broker can make things easier for brew pubs26. These agents know the craft brewing industry. They help find the best insurance at fair prices26. By understanding what influences Brew Pub Insurance and Brew Pub Insurance Factors, brew pub owners can stand strong. They’ll be able to deal with their insurance needs and costs. This helps their businesses do well in the long run.
FAQ
What are the key factors that affect brew pub insurance premiums?
How does the type of brew pub impact insurance costs?
What role does the volume and percentage of alcohol sales play in insurance premiums?
How does the value of a brew pub’s assets impact insurance costs?
How does the size and location of the brew pub premises affect insurance rates?
How do the number of employees affect brew pub insurance?
How does a brew pub’s business history and claims record affect insurance premiums?
What are the key liability risks for brew pubs?
How can working with an experienced independent insurance agent help brew pubs with their insurance needs?
Source Links
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- https://smartfinancial.com/brewery-insurance – Qualify for a Brewery Insurance Program To Protect Your Business | SmartFinancial
- https://www.alliedinsmgr.com/brewery-insurance-made-simple-everything-you-need-to-know/ – Brewery Insurance Made Simple: Everything You Need to Know – Allied Insurance Managers
- https://www.aigltd.com/insurance-blog-car-auto-home-life-commercial-reading-pa/6-factors-that-affect-the-cost-of-restaurant-insurance – 6 Factors That Affect the Cost of Restaurant Insurance
- https://www.workerscompensationshop.com/workers-comp-programs/bar-insurance – Bar Workers’ Compensation | Bar Insurance
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- https://uwib.com/7-brewery-insurance-policies-to-consider/ – 7 Brewery Insurance Policies to Consider | United Western Insurance Brokers
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- https://www.harrylevineinsurance.com/liquor-liability-insurance-explained/ – Liquor Liability Insurance Explained – Harry Levine Insurance
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