Brewery Insurance

Brewery Insurance

In 2021, there were approximately 9,250 breweries across the United States. The sheer number comprises micro-breweries, craft, large craft, and non-craft breweries.

The beer industry is steadily growing in response to the high demand for the beverage among US consumers.

Interestingly, as the industry grows, players must deal with inherent and emerging risks in the sector. For instance, due to high competition, breweries may apply cost-cutting measures affecting their ability to protect employees from workplace hazards.

To that end, breweries must appreciate these risks and put contingency measures to protect their investments. Luckily, brewery insurance is designed to shield brewers from unforeseen risks and hazards.

Here’s what you need to know about brewery insurance.

Common Risks That Breweries Face


A brewery has a chain of production lines that expose employees to risks of injuries. Common injuries that employees suffer include traumatic brain injuries, burns, broken bones, spinal injuries, and sometimes death.

Unfortunately, when an employee suffers an injury in the line of duty, the brewery is held liable for the subsequent costs. Worse still, the settlement process involves hefty legal suits and costs capable of ruining your finances.

Here are a few sources of injuries in a brewery.

  • Hot Surfaces: In spite of the safety signs, training, and supervision, mistakes happen. For instance, an employee can accidentally touch a boiler, hot liquids, or steam, resulting in severe burns.
  • Falls and Slips: The brewing process is water and liquids-intensive. Without thorough and regular clean-up, the floors turn slippery, increasing the risks of slips and falls. In addition, if the company fails to equip employees with safety gear, they’re at a greater risk of injury in case of a fall.
  • Ergonomic Hazards: Brewery employees stand or sit for long hours, which aggravates the risks of ergonomic injuries. For instance, standing in warped postures for extended hours exposes employees to risks of spinal injuries.

Fire Hazards

Fire hazard is predominant in any brewery necessitating a comprehensive fire risk assessment before setting up a brewery.

Here’s a list of typical sources of fire in a brewery:

  • Flammable chemicals: Ethanol is highly flammable and a common ingredient in breweries. What’s more, it has a low flashpoint, which means it can ignite at even low temperatures when a spark is applied. Therefore, if ethanol leaks in an enclosed space like a boiler, it can easily burst into flames.
  • Dust explosions: The production of beer involves the fermentation of grain, also known as malted barley. Remember, fermentation is the final step preceding cleaning, grinding, and storage of the grain. Unfortunately, grain dust is highly combustible when conditions are right. The dry milling of malted barley produces a considerable volume of grain dust. Therefore, breweries should opt for wet milling methods to minimize the fire hazard.
  • Electrical installations: Poor electrical installations are another source of fire hazards. A defective electrical installation can ignite on contact with flammable materials like ethanol. In addition, be on the lookout for additional hazards like inadequate or faulty wiring.

A point to note: Fire hazards pose huge implications in a brewery. Previous reported fire incidences have resulted in huge losses, property damage, severe injuries, and deaths.

Faulty Equipment

The production line in breweries is machine intensive. A brewery requires different sets of machinery to produce, store, cool, and pack. The standard machinery found in breweries includes a malt mill, heat exchanger, Brite tank, filtration system, kegs, brewhouse, valves, and pumps.

If any of the above machinery fails, it can disrupt the operations leading to a massive loss. For example, if the gauge of the coolant malfunctions, it affects the subsequent processes resulting in a damaged batch.

On the other hand, if the packaging machinery fails, it can result in breakages, chipping, defective caps, and ultimately contaminated beer.

Business Interruption

A brewery doesn’t operate in a perfect business environment, which makes it vulnerable to business interruptions. Sadly, an interruption affects its operations, profitability, or financial prospects.

Here are a few examples of disruptions:

  • Natural disasters: The operation of a brewery can halt if a natural disaster occurs. For instance, a severe storm or flooding event can destroy the building, making it impossible to operate. In case of floods, it may become impossible to access the building.
  • Supply chain: A brewery that heavily relies on a single supplier faces an existential risk of supply chain disruptions. If the supplier suffers unforeseen delays, it trickles down to the brewery.
  • Labor force: A brewery should conduct a continuous evaluation of possible disruptions within the labor force. For example, a key employee can pass on, quit, or fall sick, jeopardizing operations. Therefore, a brewery with a few employees should institute continuity plans. Equally, mid to large-sized breweries should conduct succession planning of their management to enhance seamless succession.

Coverage Offered by Brewery Insurance

If a brewery encounters any of the above risks, its normal operations become disrupted. As such, it’s prudent to procure brewery insurance to keep the business running while dealing with the risks.

Here’s the breakdown of coverage offered by brewery insurance:

Property Damage

Brewery insurance can pay for damages to your building, machinery and processing equipment, accounting records, fence and landscaping, and inventory in case of damage. The common risks covered under this category include fire, weather events, theft, vandalism, civil unrest, and other causes.

Here’s how coverage of property damage enhances your recovery:

  • Loss of assets: The brewery insurance pays the replacement value of the lost assets like furniture, stock, and machinery
  • Liability protection: It’ll also cover property damage to third parties that arise in the course of business.
  • Business disruption: Some form of property damage has severe consequences which disrupt business operations. For example, a fire outbreak that burns down the malt barley storage leads to a total loss of stock. Brewery insurance can offer monetary support to acquire fresh stock and lost revenue.

Liquor Liability

Any establishment that serves, sells, manufacturers, or distributes alcoholic beverages requires liquor liability insurance. Its primary objective is to shield brewers from legal liability. Liquor-related claims occur after a bodily injury or property damage occurs following a misdemeanor of an intoxicated customer.

For example, an intoxicated customer stumbles toward another patron who falls and breaks their leg. The brewery insurance helps to settle the resulting medical bills, ambulance services, and the cost of emergency care. Alternatively, in the event of a legal suit, the insurance can cover any legal fees, court costs, and settlement amounts.

Lastly, brewery insurance can cover the cost of property damage caused by a customer under the influence of alcohol.

Product Contamination

Beer production is a sensitive process that can easily suffer contamination. As a brewer, you’d be facing unimaginable losses if an entire batch of beer becomes spoiled. There are different forms of bacteria that can cause contamination in breweries.

The harmful bacteria vary based on the stage of production, whether mashing, cooling, bottling, or conditioning. The common bacteria include Acetobacteraceae, Thermophilic lactobacillus, Coliform bacteria, or Hafnia sp.

A brewer who notices contaminated products can prevent further losses by stopping selling or distribution. If a consumer takes contaminated beer and develops health complications, the brewer may be sued for negligence.

Ultimately, brewery insurance shields breweries from financial loss and legal liability associated with product contamination.

Workers’ Compensation

Breweries mirror production lines in manufacturing companies exposing their employees to accidental injuries. The hazardous working environment exposes brewery employees to chemical burns, falls, brain injuries, fractures, amputations, and musculoskeletal disorders.

The Occupational Health and Safety(OHSA) Act requires all employers to provide a safe working environment to their workforce. Equally, employers must compensate employees who suffer injuries or harm as a result of safety violations.

Remember, quality medical care is expensive and can impact the finances of any organization. That said, worker’s compensation coverage is vital in protecting breweries from employee-related risks.

Here’s how workers' compensation coverage protects breweries:

  • Medical care: It covers medication, emergency care, rehabilitation, diagnosis, consultation, and other treatment-related costs.
  • Temporary disability: The coverage may pay an employee's lost income in case of temporary disability.
  • Legal liability coverage: Meets the court costs, legal fees, and settlement associated with OHSA violations.
  • Compensation in case of permanent disability
  • Death benefits

Equipment Breakdown

Brewing is a machine-intensive process that puts a brewery at risk in case of machine breakdown. For instance, if the boiler breaks down, it can disrupt the planned day’s production.

In addition, once a component breaks down, it may take months or weeks to fix. The equipment breakdown coverage meets the cost of repairs or replacement following a sudden or accidental breakdown. It can also offer cash injection to calm the effects of business disruption, such as lost revenue.

Ultimately, the breakdown of critical machinery may result in production delays, inability to fulfill orders, increased cost of business, and reduced profit margins.

Try Our Brewery Insurance Services Today

In the event of machinery failure, an entire batch of beer can become spoiled, resulting in losses. It’s, therefore, prudent to acquire brewery insurance to protect your business during uncertainties. FACE Insurance is dedicated to offering the best insurance coverage to breweries. Contact us online or call us at 916.721.2845.

Frequently Asked Questions

Your should contact the police as soon as possible. The quicker you act, the faster the authorities will be able to collect information regarding your stolen item. Your insurance agent should also be notified right after you have made contact with the police.

The most common way art is stolen is Burglary. It’s important that your installations have proper security in order to prevent these crimes from happening. Its also very important to make sure that the staff you higher to give your building maintenance has a clean record and has no criminal history.

Its responsibility of the insurance carrier to work with the FBI to recover the art that was stolen. It’s possible that you may be asked to work with the corresponding authority.

If your valuable art items are not insured, your efforts will have to be focused on working with the authorities to recover your stolen items. The odds of recovering your stolen items is very low.

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