Microbrewery Insurance & Finance

One of the essential elements of being able to set up your own microbrewery is getting access to finance and then being able to obtain specialist microbrewery insurance at competitive rates.

Which is the cheapest microbrewery insurance?

Insurance Enquiry Form

There is a range of microbrewery insurance products out there.  The cost and the cheapest insurance will depend on the type and extent of your cover along with the amount of cover that is appropriate for your brewery size.  For instance if you are a nanobrewery only brewing occasionally in small quantities; then the cost of your insurance should be relatively small and could be as low as a couple of hundred pounds per year.  A small microbrewery might be looking at a £1000 plus which is typical for a small business.  One aspect of insurance is that insurance companies are quite clever at increasing your premium slightly above the rate of inflation over time.  They also increase the amount of your cover  this is the sum insured so the maximum amout that they are prepared to pay out on.  The result of this is that over time your insurance premium with the same insurer will tend to go up.  It is always worth shopping around every few years to guage what the cheapest brewery insurance cover should be.  You can often then go back to your existing brewery insurance company and ask them to match the cheaper quote on a like for like basis.  Often they will do that because they want to keep your business so just the process of getting a couple of quotes could shave 15-20% of your costs.  The other critical issue is the level of the excess that is set.  A lot of brewery insurance policies may suggest that cover is extensive but you need to ask what levels the excess.  if these are too high it will often make any claims against the cover unviable.

What is the best microbrewery insurance?

When looking at what is going to be the best microbrewery insurance for your business then there is always the difficult evaluation of what extra features are worth paying for vs the cheapest microbrewery insurance, it's a case of cost vs value.  Some of the additional features that some insurance cover will give you include:

• loss to your business resulting from business interruption due to circumstances outside your control
• insurance of the cash held on your business or whilst in transit say on the way to outside events
• the degree that your brewery is protected from damage and has it's equipment covered for breakdown
• is your beer covered for loss due to contaminated yeast

Microbrewery insurance - things to consider

Having successfully financed and set up a microbrewery every brewery owner whether big or small know they needs this.  Microbrewery insurance is a necessary evil; some key things to look for in the cover when insuring your brewery are:

1. Use a specialist microbrewery insurance broker.  It goes without saying that an expert insurance broker will not only have access to better microbrewery insurance products but they will be more able to advise individual brewery owners what level of cover is appropriate.
2. Do you or are you looking to export beer?  In which case do you need a policy that covers your beer stock that is being exported overseas
3. Does your microbrewery insurance cover you against loss of your beer stock on 3rd party premises?
4. We all no that one of the big problems of brewing cask beers is getting all your casks back.  So does the insurance policy cover your beer casks and their loss?
5. Does your microbrewery have visits from members of the public on brewery tours and does it put on events.  Therefore, do you need public liability insurance to cover potential claims by members of the public whilst on brewery tours?
7. Is your microbrewery covered in the the event of equipment failure?
8. Are you just a small craft brewery starting out.  If sos you probably don’t want the level of brewery insurance cover that the big boys require.  Our specialist brewery insurance brokers will evaluate he cover and get the best quote for your needs.
9. If you employ people in your microbrewery you will need liability insurance for your brewing and other staff
10.  Do you have product liability insurance?  Remember selling beer to the public means that you have potential large liabilities should somebody fall ill as a result of consuming your product.  Make sure you cover your brewery against this liability.
11.  Does you microbrewery insurance cover your casks at third party locations i.e. pubs?
12. Will your brewery insurance company pay up for the loss of a brew which is down to contaminated yeast?
13. Will your microbrewery insurance cover your beer during transit in the UK and overseas?
14.  Increasingly for many microbreweries a big part of their business is providing beer and a bar for outside events such as beer festivals and farmer markets.  You and any staff need to be covered for these events and any potential off sales.

Insurance for brewery visits & tap rooms

One of the other things to consider when looking at insuring your microbrewery is getting public liability insurance for visiting members of the public.  Increasingly breweries are not only places of beer production but they hold events, talks, brewery visits and many new microbreweries the tap room is an essential part of their business.  This introduces a whole new area of risk to your brewery because bringing members of the public into a functioning manufacturing unit with chemicals, hot liquids, industrial equipment and processes obviously increases the potential risk profile.  Make sure you brewery insurance covers you for this and that you adquate cover.  Some insurance providers may insist on extra precuations or risk assessments taking place to minimise the risk of the visiting members of the public getting hurt or damage or theft from your microbrewery taking place.

How to obtain specialist microbrewery insurance?

Have a look at our guide on what to look out for when you look to get your brewery insured.  Clearly you don’t want to take the risk of being under insured or not covered for specific items.  At the same time paying out extra on your brewery insurance premium for no benefit is costly.  Using an experienced specialist brewery insurance broker should enable you to get the insurance product that’s right for your brewery.

Here is a list of microbrewery insurance brokers providing specialist policies:

Alan Boswell - Specialist Brewery Insurance

Some of the key features of the Alan Boswell brewery insurance are:

• The brewery insurance covers start up microbreweries so you don't have to have a number of years trading to obtain cover
• Cover for bursting of barrels (it happens!)
• Their brewery insurance covers property and stock such as stored beer that is left in the open
• Cover of beer and stock that is away from your brewery

FOR MORE INFORMATION & INSTANT COVER CALL 01603 218000 & quote BREW-SCHOOL for best rates.

Towergate

Russell scanalan

Clarke Dove

Billington

Brewcover

CBI

GMM

Preferred Brewery Insurance

WH & McCartney

John Morgan Partnership Ltd

Motts Insurance

Are you a specialist brewery insurance broker and would like to be featured on our comprehensive brokers list then email us at: insurance@brew-school.com

Do I need insurance for my nanobrewery?

If you do have a nanobrewery even producing beer on a very small scale commercially and selling it to members of the public you will need brewery insurance.  You will obviously need to insure yourself against the public liabilty for providing a drink product to member of the public.  What happens if somebody becomes ill as a result of consuming your beer or there is a case of an exploding beer bottle.  All this could result in significant legal costs even if your brewery business ultimately is not to be found at fault.  The good news is that nanobreweries are seen as fairly low risk businesses so that insuring your nanobrewery should not cost a fortune.  It is perfectly possible to obtain cover for less than £100.   On a number of specialist brewing forums several nanobrewery operators have recommended NFU Mutual as being particularly well priced.  They also do provide cover for artisan food and drinks producers selling at Farmers Markets and Food Fairs so combining the two may be a good idea.  If you do require further advice about the level of insurance for your nanobrewery you could try contacting Alan Boswell for advice and a detailed quote.

Brewery Finance Sources

There are a number of finance options for start up breweries which we do go through on our Setting Up A Microbrewery Course as well as expanding their brewery operations.  We cover aspects of the brewery design and finance in another one day course.  A key aspect for any new or existing brewery trying to gain finance is the quality of their business plan.  On our one day course we look with Close Brother Finance at examples of how to structure your business plan in a way that will tick the boxes of potential funders and give your application for funds the best change of success.  Potential finance sources for a brewery are:

• Asset backed finance
• Start up loans through organisations such as Responsible Finance the Community Development Finance Association (CDFA).  These could be invaluable in providing both start up and development finance for microbreweries
• Crowdfunding
• Don’t ignore friends and family
• Brewery Bank (coming soon)

Brew-Schools Brewery Bank

Here at Brew-School we realise that it can often be the initial seed funding for new brewery ventures that can be the hardest for new breweries to access.  This is why we are working with leading brewing experts to develop a  Brewery Bank.  This Bank will take a flexibly approach to funding start up and expansion plans by existing breweries in a way that suits your business plans.  Finance will be available in a number of ways from offering finance in return for an equity stake to loan finance.  The board of the brewery bank will have a wealth of brewing experience which along with the funds will be able to guide your new brewery or the expansion of your brewery to the place where you need it to be.  Think Dragons Den of the brewing world but with the Dragons being on your side.

Breweries for sale

If you are looking at investing in a brewery there is an increasing market in second hand breweries for sale.

If you are looking a buying a brewery now or in the future check out the brewery for sale section in our news blog.

Brewery Investment Fund

Have you ever wanted to own a microbrewery but are just too busy to set up a microbrewery yourself?  This could be the answer.  Brew-School in association with it's expert partners will be shortly launching it's own Microbrewery Fund enabling beer fans and investors to buy a slice of a brewery and invest in this new and popular investment area.  Could you invest in the next Brewdog?  For more information and to register your interest in the Brewery Investment Fund email: bif@brew-school.com