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InsuranceMan 2.0

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Everything posted by InsuranceMan 2.0

  1. InsuranceMan 2.0

    Forking Forklift Questions

    @Patio29Dadio, I would like to give you one other thing to consider as well in the scenario you shared above is you are thinking about buying this with a guy in your building. That is all good and fine and saves money, but you need to think about insurance. How will you insure it, who will be reimbursed if something happens to the equipment? What happens if the other guy is using it and causes damage or injury and your name is on it as well? There are a lot of things to consider when going in on purchases with folks outside your business. There are solutions to all of these issues, but you need to keep them in mind when looking into joint ventures, for sure. I have seen things like this come back to bite folks who did nothing wrong aside from having a co-ownership on something. Best, Aaron
  2. InsuranceMan 2.0

    Tuesday Morning Insurance Tidbit - PPC

    Happy Tuesday Morning Fellow ADI-ers, I wanted to offer a quick Tuesday Morning Insurance Tidbit for all of those looking to start a distillery, move to a new location, or open another location. In the world of insurance there are a lot of factors that come into play when trying to obtain coverage, as well as how those factors directly impact the premiums you pay. Today I want to focus on a topic that has been an issue for quite sometime, Public Protection Class, or PPC. The PPC program is a tool that was developed by the Insurance Services Office (ISO) for property and casualty insurers so that they can assess risk by a rating of "fire protection" services. The ISO pulled information from more than 47,000 communities in order to create this rating program. Essentially, this tool ranks PPC's on a scale of 1 to 10. A class 1 represents superior fire protection, whereas a 10 indicates that not even the minimum requirements are available. So what does that mean, exactly. Well, any of you that know me or have read my other postings know that I am a straightforward, "put it into plain English" kind of guy, so here is what it means; If you are located in a PPC 1 it means the fire department is located super-duper close to you, it has a full time staff, and you have a fire-hydrant pretty much on your property or in your building. So if something were to happen at your distillery and there were a fire or emergency need, the fire department would probably know about it before you do and they would quell any threat of loss before it caused much damage. With that being said, I am sure you have concluded for yourself at this point that a PPC 10 is probably not so good. You are correct! A PPC 10 to an underwriter causes an instinctive primal reaction wherein they shield their eyes, snap their head back, scream in disbelief, and start mumbling incantations. Picture the scene from the "Exorcist", yeah, kinda like that!!!!!! Nearly every underwriter in the known universe will become physically sick at the thought of a PPC 10. Actually, most carriers will not even entertain a risk in a PPC 7 or higher. I have even been told that these locations may as well be on the moon. I wrote a post about that here, actually: So what does this mean to you? It means that when you are considering your location you need to do some research in regards to the PPC. Insurance is not usually the first thing that people have in mind when wanting to open a distillery, but it should be dang near the top of the list. If you do your legwork ahead of time and find out what the PPC is of your proposed location, it is going to make your life much easier, and cheaper in the future. As I said earlier, this one factor alone can affect if you can even find insurance coverage and then what you will pay for it. Property rates on your building, equipment, and stock will be much lower in a PPC 1 then they will in a PC 6, and if it is a PC 7 or higher, well my friend, get your checkbook ready!!!!!!! Now you may be wondering, "OK, I need to find out the PPC of the location I am interested in. How do I do that??" The answer is actually very simple. Pull out your phone, google your local fire department, give them a call and tell them you would like to know the PPC of the address in question and they will tell you what it is. Voilà! Mission accomplished! It really is that easy and it truly can save you a lot of time and money down the road. I hope you have enjoyed this Tuesday Morning Insurance Tidbit, and as always, I am here to assist you in anyway that I can when it comes to your insurance needs. I work with an incredible amount of distillers all over the country and I have seen pretty much everything, so if you have questions, I more than likely have answers. Please feel free to give me a call at 307-752-5961 at any time. Best, Aaron Linden (aka InsuranceMan/InsuranceMan 2.0)
  3. InsuranceMan 2.0

    Amendment to drop DSP Bond Time Line

    Agreed, that is a long time. My experience has shown me that it really should be resolved within 30 days. Most of my clients that have put in for the exemption online through PONL have had it turned around in anywhere from 2 weeks to a month. I would give them a call. Best, Aaron
  4. InsuranceMan 2.0

    Insurance

    ***** UPDATE ***** EVERYONE ... I wanted to let you all know that I am still here, I am still in the game, albeit with a new place to call home ... but nonetheless I am still here and providing the top of the line insurance for distilleries around the country for the best premiums possible. My phone number has remained the same, and thank you to all of you who have recently called me to put your insurance packages together. The amount of support and people that have let me know I was missed in the interim is truly overwhelming!!!! ADI folks are the best folks on the planet! If you have not had a chance to get a hold of me, what is stopping you?!?!?!!? In case you need my number it is 307-752-5961. I look forward to hearing from all of you! Best, Aaron
  5. @Michaelangelo and others, I quite agree with what you have said. It is up to the interpretation of someone behind a desk, whether we are talking about the Fed's, local authorities, or insurance companies. In the case of the latter it is usually an underwriter, who is making decisions based on the companies actuarial team. Have you ever met an actuary in person???? They are like morticians mixed with forensic CPA's, but with less personality 😂 . With that being the case, it really is up to your insurance professional to do the job you need them to do. I always tell people that I need to sell the policy twice; once to the underwriter, and then to the client. In reality the insurance world is based on a string of events. The client must tell me what they are doing and what they need; I have to make sure I have done all of my investigative research and put together the appropriate coverage package; I need to paint the prettiest but most honest picture of that to the underwriter; they have to accept what we are telling them and offer us a proposal based on that information. Therein lies the problem: Human decision making. Appetites of insurance risk are different for all carriers, and underwriters fluctuate wildly from carrier to carrier. So the chances of there ever being a "standard" set of insurance provisos is slim to none. I have had conversations with the TTB, folks from the national IFC-ICC office, and many others asking to introduce some standard of insurance across the distillery world, but to no avail. Here is why, no one can actually make you purchase insurance. Yes, the TTB can require you to have a bond, and your lending institution can tell you that your equipment needs to be insured if there is a loan on it, and your landlord can even require you to provide a liability policy in order to become a tenant. However, in the grand scheme of things, there is no "requirement" that a distillery carry any type of insurance what-so-ever. An example is a friend of mine that makes a very "top shelf" whiskey at his home residence in a very nice area of the country. He owns his buildings, still, everything - outright with no one owed anything. He produces under the yearly withdrawal limit for the Fed's, so he does not need a bond. HE CARRIERS NO INSURANCE! No general liability, no property, he does not even carry liquor liability (this part makes me absolutely crazy) ! Do you know why? Because he does not have to and he sees no value in it. He has said that if his place were to go to the ground, he would find something else to occupy his time. I don't know many of us like that, but the point is that there are no standards or requirements as to distillery insurance because you do not have to have it. You should have coverage, but you are not required to. Each distillery is as unique as the products they are making and therefore, no one distillery has the same needs as another, and no one can make you insure your operation. As to minimum distances and what defines separation, again, there is no hard-fast-rule. The TTB says the following from 27 CFR Part 19 §19.52: §19.52 Restrictions on location of plants. A person who intends to establish a distilled spirits plant may not locate it in any of the following places: (a) In any residence, shed, yard, or enclosure connected to a residence; (b) On any vessel or boat; (c) Where beer or wine is produced; (d) Where liquors are sold at retail; or (e) Where any other business is conducted except as provided in §19.54. So what does this mean ... who knows! Just more grey area really. I will tell you who can define "distance" and "separation" with definitive authority though, since the Fed's cannot or are not willing to ... Your local fire Marshall and your insurance company. Again, this is going to swing wildly depending on the "human decision maker" that happens to be your local Marshall or insurance carrier, but they can and will tell you what they are accepting of and what you can and cannot do. Trust me, if no one cares at a federal level, someone may care at a local level, and if they don't care, I guarantee you that the insurance company will care. I have had carriers say that there must be a minimum distance of no less than 50' between structures, but others have said it didn't matter as long as there was separation (in that case about 10' ). In a nutshell, there is no requirement to even carry insurance, the distances are not clearly defined, and it all depends on where you are and who you are dealing with, but at the end of the day, it is up to the locals and your insurance carrier. They will be the ones that define what is or is not acceptable. Best, Aaron 307-752-5961
  6. @dhdunbar, that is a great question and one that comes up quite often. Interestingly, a residence on the same tract of land as the distillery is NOT an issue. As it turns out, this setup has become quite common among several of the smaller distilleries. they have their home, and then out on the back 40 they have a nice pole building that they have decided to set up shop in to make their product. The COMMERCIAL insurance carriers do not seem to have an issue with this at all (as long as you are not located way out in the boonies. There are then issues with Public Protection Classes (PPC's) that could arise, but that may be for another post). Some separation is preferable, but it has never really been established as to what that distance is. I will say that they do not want the distillery operation in an attached building such as a garage or something of that nature, but I have seen the distillery structure as close as 10 feet away from the home. The reason I said that "COMMERCIAL" insurance carriers do not seem to have an issue is due to the fact that some PERSONAL LINES CARRIERS may have a big issue with this setup. Many homeowners policies do not contemplate any type of commercial exposure, aside from perhaps a small home office or the like. Therefore, most homeowners policies do not like the idea of a business being set up on the same physical location as the home, especially if there is any kind of exposure to "customers" entering and exiting the property, and God forbid there may be a tasting room!!!!!!!!!!!!!!!! That is not reason to despair, or not have your distillery located at your homes physical address, it is just yet another hurdle. Many homeowners carriers, once made aware that there is a commercial policy in place, may be fine knowing that if there is an exposure due to the business they will not be the ones having to deal with it. Again though, there is room for grey area here. Quick example ... Distillery "X" sets up his/her shop in a pole building on their home's physical property. The distillery is down a branch of driveway separated from the home. A tourist happens to come by and wants to see the distillery and purchase a bottle (assuming that is legal where this is), so they drive up the driveway to the distillery. Finding no one at the distillery, they hop back in the car and head to the house to find the proprietor. Upon getting out of their car to approach the house, they are knocked over by a goat and suffer an injury. I know this sounds like a long shot, but I have seen this happen! So I ask, which policy should be on the hook in this circumstance? The commercial policy since the person was there to see the distillery after-all ... or the personal homeowners since this person was now at the residence and the goat is covered by the homeowners? The answer is, who knows!!!!! It will be for the insurance companies to fight over and figure out. In this scenario however, I fought that it should be the commercial policy since the proximate cause of the injury was in deed the goat, but the reasoning for the injured party to even be in that situation was due to the business exposure. The long and the short of all of this is that if you set up shop on the same tract of land that your home is on, expect to have some insurance issues, at least of a personal lines nature. I would contact your homeowners carrier ahead of time and see what there stance on this is. Better to find out in advance than risk being cancelled down the road, or find out you are in violation of the contractual language of the policy. Again though, I am here to help and can usually facilitate solutions and agreements between all parties. @bdsammy94, how in the heck are you doing, sir!?!?!?!? We need to catch up, and soon. In regards to what you are saying, I understand and have no doubt that you have been able to move forward into mixed use areas. However, that is somewhat due to enjoying the fruits of already having coverage with that certain carrier and being somewhat "grandfathered in" ... thanks to me 😎. Back in the day when your insurance was written, the carrier did not have the same stance on "residences" like they do now. As stated, they took a step back in June and started reassessing things. Most anyone that was already with them can move forward under the old guidelines, for the most part. It is the new folks coming in and wanting to go into mixed use buildings that are having the issue. I have several distilleries in areas that have condos and apartments above them, but trying to place new clients wanting to do the same is becoming more difficult with each passing day. I hope this helps to explain some of the potential issues that can arise in choosing a location, but again, if you have any questions or want to pick my brain, the advice and experience are free for the taking. Best, Aaron Linden - CIC 307-752-5961
  7. InsuranceMan 2.0

    FET Tax Cut Article

    All, I just wanted to share an article that I was honored to be featured in recently that discusses the new lower FET rates, and what needs to happen at a grass roots level in order to make sure that the rates are extended beyond the 2019 date. I have done a lot of work with different groups in regards to the impact that this new rate has had throughout the industry but I would implore you, the owners of distilleries, do everyone a huge favor ... Document, document, document! Of all the groups I have worked with, and all the discussions I have had, the most important factor in the very near future is going to be documentation. If you are enjoying the new lower FET's, and you have been able to purchase new equipment, finally do that marketing campaign you have been dreaming of, or hire some new employees to increase your output, DOCUMENT IT!!!!! Put real numbers to work for you. If you have saved "X" amount of dollars due to the lower FET rate, and have reinvested that in the economy via purchases, employment, whatever, make sure you are documenting it and sharing it with your state guild, national associations, etc. I am here to warn you, if this information is not produced and shared in concrete numbers, the government all-to-likely may not extend this wonderful incentive. If no one can provide solid evidence as to the economic impact that this has had on the industry as a whole, there will be no incentive for the fed's to cut their own large source of funding any further. I would also caution that these numbers have to be produced sooner than later due to the fact that these rates are due to expire at the end of 2019 unless action is taken. That means that numbers for 2018 need to be pulled together and presented as soon as 2019 kicks off. The government is a big ship and it turns slowly, meaning, these numbers cannot be produced in September of 2019 with the hopes of having anyone have time to look at them in time to have an impact. Keep in mind that these lower FET's are due to "sunset" on December 31st, 2019 if action is not taken. That is what I am asking of you all, to take action. Start pulling your "economic impact" numbers together now, so that come the end of 2018, you can go into 2019 armed with the information needed to ensure that these lower rates are here to stay! Here is a link to the article in case you would like to check it out: http://www.spiritedbiz.com/inside-spirits-making-the-tax-cut-permanent/ Best, Aaron Linden 307-752-5961
  8. I just wanted to take a moment to update everyone in regards to this topic and how it relates to possible insurance implications. As recently as June, many insurance carriers have taken a step back and started to assess their book of distillery clients in order to maintain a strong program and competitive rates. In doing so, many of the "admitted" carriers (of which there really are only about 4 that do it well) have determined that a mixed use building poses a "life-safety" hazard. What this means is that if there are "residences" in the same building as a distillery then it is not a desirable risk and will be declined. The carriers loosely define a "residence" as any unit that people occupy in the building, overnight, or as a permanent home. So any building containing apartment units, condos, hotel/motel units, etc. are now not a desirable class of business for most "admitted" carriers. I have defined what an "admitted carrier" and a "non-admitted" carrier are in the past under my articles that I posted as InsuranceMan, but here is a quick recap ... Admitted carriers are admitted to do business in the state in which they write insurance, pay into the state guarantee fund, and are regulated by the state Department of Insurance. Non-Admitted carriers (or "surplus lines" carriers) are not admitted in the state, they do not pay into the state guarantee fund, and they are overseen by the far less invasive state "surplus lines office". So, what does that mean? It means that admitted carriers have to file rates with the state, follow certain rules, make sure there is enough money set aside (guarantee fund) to pay claims in the state, and answer to the Department of Insurance. These regulations tighten up what the carriers are and are not willing to write (sometimes based on their filings and rates) which makes placing more difficult accounts much harder, but it keeps premiums lower and more competitive on the more "standard" business. Non-Admitted carriers however, can do pretty much whatever they like as they don't have to have specific rates filed (more of a range really), and can take on any risk they care to underwrite ... but it comes with a price. Ever hear of "Lloyd's of London"!?!?!? They will write dang near anything, but often times it comes at the price of a hefty premium. The long and the short of what I am saying is this, if you have a location that is just so amazingly stellar that you simply MUST HAVE IT for your distillery location, but there are "residences" in the building, expect to have a hard time obtaining insurance (unless you contact me of course, I have placed dozens of these), and expect to pay at least 2 to 3 times more than if you were in a standalone building, or a location that other businesses occupy (at least in regards to the General Liability aspect of your policy). The rule of thumb as I have come to say is, "Insurance Companies care if someone is sleeping there." As always, if you have questions, whether you are just thinking about fixin' to get ready to maybe start a distillery, or if you are years into your operation, I am here to help. I love to answer questions in regards to distillery insurance and I have seen nearly everything there is to see in regards to questions and issues. I have been doing this a long time and it is very rare that someone brings me a question or issue I have not had experience in dealing with. Maybe you can bring something to me that is new, I would love that and to help in whatever way possible. If you want to run something by me or have me look things over please just PM me or call my cell at 307-752-5961. Best, Aaron Linden - Insurance Superhero
  9. InsuranceMan 2.0

    PATH Act and Lower FET rates

    @kansftb, you would calculate your rate at the $2.70 for calendar years 2018 and 2019. After those year ranges, it is anyone's guess. I hope this is helpful for you and give me a shout here soon about the rest of your insurance needs! Here is a link to the TTB site where you can read about this for yourself if you like: https://www.ttb.gov/alcohol/craft-beverage-modernization-and-tax-reform.shtml Best, Aaron
  10. InsuranceMan 2.0

    I'm new!

    Welcome to the forums!!!!!!!!!!
  11. InsuranceMan 2.0

    PATH Act and Lower FET rates

    @daveflintstone, I am back and better than ever! I am now known as InsuranceMan 2.0 and I would love to catch up with you and hear how things are going for you. I can be reached at 307-752-5961. And to everyone else here, if you have any insurance or bonding needs, I have worked with hundreds of distilleries across all 50 states and no one has more background or experience than me!
  12. InsuranceMan 2.0

    InsuranceMan 2.0

    HEEEEEEELLLLLLLLLLLLOOOOOOOOOOOOOOOOO A D I !!!! I'M BACK!!!!!!!!!!!!!!!!!!!!! First and foremost, I want to thank all of you for the phone calls and emails checking in on me and my whereabouts over the last several months, it means the world to me to know how much you all care. Second, I want to say hello to all my old friends here, and a special shout out to those of you whom I have not yet had a chance to meet or speak with. I look forward to hearing from all of you and working with you. Yes, like a phoenix rising from the ashes, InsuranceMan (my previous handle here on the fantastic ADI Forums, I encourage you to look up my postings. They are pretty good if I do say so myself) has transformed into InsuranceMan 2.0 and it is not just in name, but in so very many other ways. I still am the industry expert when it comes to all things distillery insurance related, but now I have the ability, flexibility, agility, and so many other "ilities" to assist you in so many ways that it will make your head spin! So, without much further ado, let's get this party started!!!!!!!!! I am here, ready, willing, and wanting to work with all of you in regards to your insurance needs. As you may already know, if you have read my past postings, I have 16 years of insurance industry experience and over 7 years of expertise in very specialized distillery insurance programs. No one else in the country can say the same! And I am not tooting my own horn here, you can ask around, there is no one that knows this industry like I do. I have gone grain to glass at 4 different distilleries and understand your needs from your side of things. Partner that with the expertise I have in the insurance world, and the fact that I work with hundreds of distilleries across the country, and well friend, you have a winning combo! Oh yeah, and the fact that I do it better and cheaper than anyone else is kind of a nice notch in the belt as well. Well, what are you waiting for?!!??!??! You know you want to call me, so DO IT!!!!!!! Oh, yes, you need my phone number. Maybe that is what was holding you up. Well, it is the same as it has always been. Here it is again though, in case you don't have it already. 307-752-5961 OK, now what are you waiting for? I answer my own phone, give you as much advice as you can handle, and answer all of your questions, all you have to do is call. Again, I look forward to speaking to all of you and getting to know you better. Best, Aaron Linden 307-752-5961
  13. InsuranceMan 2.0

    InsuranceMan 2.0

    @Skaalvenn, you rock! Thank you for your kind words. Next time I am in town for more than a few days, you can bet that I am going to come and see your new digs!
  14. InsuranceMan 2.0

    Inusrance

    H E L L O, A D I !!!!!!!!!!!!!!!!!!! Guess who is back?!?!?!!?!?!?! I will be doing another post here shortly under a different topic, but I wanted to reach out to all of you and let you know that I AM BACK!!!!!!!!!! Sorry for any confusion over the last few months, but trust me, as the name reflects, I am back and MUCH BETTER. Yes sir, InsuranceMan 2.0 is the TRUTH RUTH!!!!! Please feel free to contact me with all of your distillery insurance needs. From the bonding, to the general liability, work comp, products, liquor, you name it, I am still the best at it. My phone number remains the same. Give me a call at 307-752-5961 and let's chat! I look forward to hearing from all of you and thank you for your concern in my absence. But as I said, I am back and better than ever!!!!!!!!!!! Best, Aaron Linden 307-752-5961
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