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Found 25 results

  1. 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)
  2. 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
  3. InsuranceMan

    PATH Act and Lower FET rates

    Good Day ADI Forum Members, I wanted to do a post today in regards to the new regulations that have taken effect in regards to the PATH Act and the new lower FET rates that have been implemented and how that may affect your need for a bond. This seems to be a hot topic currently so I thought I would address a few issues here. As you all are aware, the PATH Act and the lower FET rates have kicked into effect for the next two years, and there are many of you that are super excited to cancel or terminate your current DSP bond. Well, let’s just hold on a second and think about what these new changes really mean. In the PATH Act, it was determined that any distillery that has less than $50,000 worth of taxable withdrawal in a year’s time no longer is subject to a bond requirement. Then, the new legislation has gone ahead and lowered the FET from $13.50 per proof gallon down to $2.70. That is wonderful, and a boon for distilleries that will allow for growth, capital investment, the hiring of staff, etc. Both the PATH Act and the reduction of the FET’s are fantastic ……………… HOWEVER ………….. The only item that was really contemplated in the PATH Act was the "Withdrawal" amount; the act never specifically said anything about the operations side of the bond. The operations side of the bond is comprised of the "Distiller / Warehouseman / Processor" portion. This portion of the bond covers for items that you have on hand that is either bottled, in process, being held in totes, or aging/maturing on site. In fact, ALL distilleries still have this exposure being that everyone has product on site in one fashion or another, and many of you have a considerable amount of product warehoused at your facilities. Think about this, if for some reason your product on hand were to be lost, stolen, or hijacked the government could still charge the full amount of taxation that would have been due. Yes, the Federal Government reserves the right to still collect the taxation that WOULD have been collected on that product! Sure, there is a repeal process that you could potentially go through to have the taxation abated or forgiven, but there is no guarantee that the TTB would waive these charges, it is done on a case by case basis. In some instances, the taxes may be due upfront until the repeal process can go through the proper channels, and that process can take a while. Although these situations are rare, they can happen. It is also rare for distilleries to blow up or burn to the ground, but that does not mean that you should not carry insurance. For this reason alone, it may be beneficial to keep your bond in place. If a situation such as this were to occur, and you have cancelled your bond, you would have to come up with the cash to pay for the taxation of the lost product. That could certainly become an issue and cause a lot of heartburn in an already stressful situation. In most cases your federal TTB bond should not be costing you more than a few hundred dollars a year, and that is fairly cheap for your piece of mind. As well, the reduced FET’s are only certain for 2018 and 2019, after that, who knows. It could be determined that the rate will go back to $13.50 or even higher, we don’t know, maybe they will leave it alone forever, God willing. Another potential reason to keep an active bond may be that it is easier to increase an already existing bond than it is to go through the entire bonding process again when you get to a point that you have to have one. If you have a history with a surety company of having a bond in place, it is a fairly easy process to issue a superseding bond to increase the amount needed. If you cancel your current bond, and for some reason your financials are not as strong in the future, obtaining a bond for a higher amount (Operation plus your need for over $50,000 in withdrawal) could be difficult. I do want to be clear, I am not trying to be a “fear-monger”, whether you keep your bond in place or not is a personal preference and I would never "twist" someones arm to keep a bond in place if they did not see the need to have one. I just want to make certain that people are educated in this arena prior to making a decision that could potentially have a severe impact on the businesses you all have worked so hard to build. Also, please keep in mind that having a bond in place is not “free money”. By that I mean, as owner of the bond you are indemnifying yourself to the surety. This means that if the surety has to make payment on your behalf, the surety will make every attempt to collect the funds that they paid out to the TTB. They can seize assets of the distillery, your personal assets, etc. The bond is simply there to make payment on your behalf if you cannot at that time. Sooner or later you will have to reconcile with the surety. If you don’t have a bond in place, you will be reconciling with the government. Either way, eventually you will be paying someone back! The long and the short of it is, just because the taxation rate is less for the next two years, and just because you may not hit $50,000 in withdrawal, you may be money ahead to keep your bond in place, especially in regards to the operations side of things. Just "booze for thought".
  4. jbdavenport1


    Looking for a recommendation for an insurance company that knows what their doing with small distilleries. Our local folks are at a loss. We cant even get a quote on loss of product should a fire or other loss happen. Any guidance would be appreciated!
  5. 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
  6. InsuranceMan

    Technology Woes

    Dear ADI Forum Members, I wanted to let everyone know that over the weekend my iPhone had a major malfunction and is currently not operating. Apple has been amazing and they are getting a new one to me as fast as they can. However, in the meantime, I do not have access to retrieve any voicemails left at my 307-752-5961 number. If you have recently left me a voicemail on my cell phone please also give me a call at the office at 307-673-2496 (or toll free at 1-800-300-4370), or send me an email at aaron.linden@hubinternational.com . Also, do yourselves a favor out there ....... if you rely heavily on your phone and technology, PLEASE back up your files and have a secondary access point. I remember the day when I knew the phone number for everyone that I would call, and know I don't know any of them. Siri is a great assistant, until she is not there anymore!!!!!!!!! LOL!!!!!
  7. Happy 11/11 everyone!!! It has been a little while since I have posted anything new here on the forums and I thank you all for that based on the fact that ADI members have been keeping me VERY busy with insurance and bonding needs. Speaking of bonds, what a segue into the hot topic of the day. On 11/7/17 the TTB released new information in regards to the "Information for Alcohol Excise Taxpayers and Applicants for Permits and Brewers’ Notices Regarding Internal Revenue Code Amendments Affecting Excise Tax Due Dates and Bond Requirements". Specifically they cite the "Protecting Americans from Tax Hikes Act of 2015 (“the PATH Act”) (Public Law 114-113). Section 332 of the PATH Act amends the Internal Revenue Code of 1986 (IRC) to change excise tax due dates and remove bond requirements for certain eligible taxpayers (see 26 U.S.C. 5061 and 5551)." Are you sleeping yet? Still with me????? OK ............ This bulletin they released specifies new "Excise Tax Due Dates" that basically say that if you were not liable for more than $50,000 of taxable liability for the calendar year prior, and you don't think you will be above that amount this year, then you can pay your taxes on a quarterly basis beginning 1/1/17. That's cool. It also says that if you reasonably (can someone define what that may mean?? "reasonably" according to who???) expect to not be liable for more than $1,000 in taxes this year as well as in the prior year, you can now pay those taxes annually rather than quarterly. No offense here, but if you have less than $1,000 in taxable liability as a distiller, you have to be quite small as that is only about 463 bottles a year, or in other words, just under 40 bottles a month. Ok, on to the "beefier" subject of this information and what you are really wanting to know; who is exempt and no longer needs this pesky bond stuff anyway!??!!?!? Well, staring as of 1/1/17 it says, " ..... taxpayers who pay taxes annually (so anyone paying less than $1,000 a year, my words here, not theirs) or quarterly (so those folks doing less than an $50,000 a year in taxable liability) will be exempt from the requirements to file bonds covering operations or withdrawals of distilled spirits or wines for nonindustrial use, or beer." Based on the fact that taxable liability only comes into play when spirits are withdrawn (yes, in some cases destroyed, but lets not focus on the negative here people) for distribution/sale (not a transfer in bond, I know my stuff), then as long as you will have less than $50,000 in taxable liability you are good to go without a bond. So is this as clear as mud yet!?!?!?! Basically what is being said here is that if you are going to have less than $50,000 in taxable liability this year (and you had less than that last year) you do not have to have a bond any longer. "BONDS!??! WE DON'T NEED NO STINKING BONDS!!!!!!!!!!" WooHoo, right!?!?!? Well ................... not so fast there speedy. There are a few things to consider before making the call to your agent and telling them to cancel that money sucking bond (actually, my bonds are the lowest in the country so they are not "money sucking" at all). First off, are you close to that bond limit of $50,000? If you are close, or expect to be "reasonably" (hahahaha) close, you may want to leave it in place, just in case. You do not want to cancel the bond only to have to turn around a few months or a few quarters later because you have increased your sales/distribution which equates to withdrawal, and now need to be bonded again. Another aspect to consider is this, when does your bond term come due? I have a lot of folks who will fit the requirements to cancel their bond, however their bond terms renew in November or December. According to the stipulations, they need to renew and keep their bond up until 1/1/17, so they MUST renew it. Here is another caveat to that, depending on the surety carrier that issues the bond, the premium may be pro-rated (you can get money back for the unused portion of the term once you cancel) but they may keep a minimum of $100 service fee ............ or ............. if the premium is 100% full earned, you may not get anything back. Well, why cancel the bond at that point?!?!?! The other issue is that the TTB will not allow you to cancel the bond until all unpaid taxes are rectified from 2016. Once they are you can file for a bond exemption with the TTB through the PONL system but they never specify how long that process will take. So here again is something to watch out for. What if your bond term is after the 1/1/17 date and you file for the exemption but it takes them 6 months (for whatever reason) to process it. Do you need to renew your bond while this is in process? At this point in time I would suggest that you do renew it since you do not want to be out of compliance during the processing time. See, this is not as simplistic as it is made to sound. Obviously, these scenarios are all in regards to existing DSP proprietors. So what about new applicants. Well, for new applicants, since the current processing time for a permit is over 200 days, you should be able to apply for your permit and ask for the exemption during the permitting process. That part actually does sound simplistic and appears to be pretty straightforward. There is a first time for everything!!! So what does this all mean, in real facts and figures and how do you know if you will be below the magical $50,000 mark? Well here is a quick mathematical computation for you (keep in mind these numbers are rounded for simplistic purposes): Current excise tax liability = $13.50 per proof gallon (proof gallon defined as 50% ABV or 100 proof) Taxes are only due when spirits leave the plant, so anything in holding/process does not count against this amount Most spirits go out the door at 80 proof, so the tax rate then would be $13.50 x .8 = $10.80 per gallon (since it is proofed down) Therefore, $50,000 / $10.80 = 4,629 gallons a year or roughly 23,000 bottles of booze, or nearly 2,000 bottles a month Here are pretty much the same numbers but done in actual proof gallons (not rounded): $50,000/$13.50 = 3,703.7 p.g. One case of 12-750’s at 80 proof = 1.902 p.g. per case 3703.7 p.g./1.902 p.g = 1,947 cases or 23,364 bottles per year (cases rounded down to full case) 1947/12 = 162.25 cases per month 23,364/12 = 1947 bottles per month So there you have it folks. A long run for a short slide as it were. The just of all of this is that some of you may not need a bond if you are just getting going and some of you may not need a bond even if you are operating, however make sure you understand where you stand and when the bond term comes due before cancelling you bond. As always, if you have any questions please feel free to reach out to me with any questions. I can be reached here on the forums, via email at aaron.linden@hubinternational.com , or give me a call or shoot me a text at 307-752-5961. I am always more than happy to assist you with your bonding questions and do keep in mind ***** I OFFER A FULL LINE OF ALL DISTILLERY INSURANCE NEEDS, AS WELL, I HAVE THE BEST RATES IN THE COUNTRY. ***** Just sayin'. Best, Aaron
  8. Good Morning! I’m Sean with Tobacco Barn Distillery in Southern Maryland and have been a lurker on this forum for well over two years. I figured it’s about time that I officially joined so that I can express my gratitude for what I’ve learned from all of you during this time. With the help/ information in this forum, we received our DSP permit, and, beat the national average for that month by 22 days! Although the list of folks on this forum that I need to thank is long, I would be remiss if I didn’t specifically single out Aaron Linden, and Holly Bowers from HUB International. Their tireless assistance with bonding and insurance is truly appreciated. With any luck, and at some point in the future, I’ll be able to help someone as much as you all have helped me. Thanks, Sean added website http://www.tobaccobarndistillery.com
  9. InsuranceMan

    ADI Convention in San Diego

    Dear Forum Members and Anonymous Info Gatherers, I am so very excited to announce that I will be in attendance at this years convention in San Diego and I look forward to seeing all my old friends and meeting so many of you that I have either communicated with already, or have yet to meet. I will be on the Expo floor located at booth #531 and I encourage all of you that are attending to stop by and introduce yourselves!!!! This year is going to be GREAT!!!!! Since I am always striving to be on the cutting edge of all things insurance and TTB bonding (if you have not read my whitepaper posted in the forums, go, read it right now! Actually, you can wait until you finish reading all of this post first, but then go immediately and read it!) I am super excited to announce that not only will I be in attendance this year, but as well I will have the incomparable Richelle Smith with me as well. Richelle is my TTB Bond underwriter and not only will she be there to assist in answering questions, SHE WILL ALSO BE ABLE TO UNDERWRITE AND ISSUE BONDS ON THE SPOT should you have a need. We will have all of the applications on hand as well as the ability to run all of the needed information and issue bonds right then and there. So, no matter if you are a "first timer" needing a bond for your up and coming distillery, or if you are just in need of a larger bond that you cannot procure though your "normal" channels, we have you covered. Oh, and BTW, our rates are the cheapest in the country for the last year and a half running. So you totally need to swing by and check that out as well since we do more of these than anyone else out there and we are fast, fun, friendly, and did I mention "cheap"!!!!!!!!! Last thing for your consideration, I will also be giving a presentation at the breakout session on Tuesday April 5th at 10:30 entitled, "Insurance: What you know, don't know, need to know" and I would love to pack the room! I promise it will be fun and not "boring old insurance", trust me, I get that insurance can be boring and a horrible topic. Not with me though, I hit all the fine points, the good stuff that you need to know and I keep it light unless you want very specified details. I can do that as well, but I like to keep that for only those that really want to know more as we get into the "nitty gritty" later on. Anyway, please, everyone stop by the booth, say "hi", get a bond while you are in the neighborhood (I want to keep Richelle super busy), and come listen to and interact with me during my presentation. I simply cannot wait to see everyone and I look forward to meeting many of you for the first time.
  10. InsuranceMan

    45 States and Counting

    Dear ADI Forum, I wanted to take a few moments to send out a heart-felt "THANK YOU" to the many of you that have made my exclusive distillery insurance program so successful to date! I just entered into my 45th state of distillery business and could not be any more pleased with the success that we have had and it is all thanks to you fine folks in the forums. You have been wonderful to work with, you have supported me from the beginning and have shared my information with others outside of the forums as well. I have had the great pleasure of getting to know many of you, watch you get going or grow over the last few years. As many of you already know, I have worked with distillery clients for many, many years, but not until I became involved with ADI and the forum was I able to connect with so many great people. I cannot think of any other way to put it besides just saying, "Thank You all so much, you mean the world to me."
  11. DistillingInsurance

    Distillery Insurance

    Good afternoon folks and congrats on the success you all are having, the jobs you're creating and the fantastic products you're creating. I'm Kyle Rheiner - an insurance agent that specializes the insurance for Craft Distilleries and Breweries. I'm outside Philadelphia, PA, and I run www.craftdistillinginsurance.com I work with the majority of the distilleries and breweries in PA and NJ and have began to expand into Texas (we insure 4 here), Tennessee, NY, CT, DE, MD, and so on. Here's an interview I did regarding Liquor Liability Insurance with one of the largest insurance magazines in the country, and this article sent me to New Orleans to speak on a panel about specializing in a niche. We insure over 40 craft breweries and distilleries. It's all I do. Read my Interview with IndAgent Mag! Whether you're a startup or established, we have the experience. Cheers, Kyle Rheiner craftdistillinginsurance.com kyle@craftbrewinginsurance.com 610-217-8685
  12. InsuranceMan

    Insurance Discussion PodCast

    Good Day Everyone, As many of you may know, I was out of the office the last several weeks traveling around with the fam and just taking a bit of much needed R&R. Timing is everything though, and in this case I missed the timing. So, for those of you in the know, maybe you have already been hip to the recently released podcast that came out on 7/22/15 on the Firewater Network featuring yours truly. If not, that is why I am posting this here and now. If you would like to tune in at your leisure and listen when you like, I have included the link below of my interview with Zachary Farley of Firewater Network where we cover pretty much everything you want to or need to know about your distillery and the insurance and bonding aspect. I hope you give it a click and give it a listen. It is informative and gives you a pretty good understanding in regards to what you will need or possible what you may need to change about your current insurance program. http://firewaternetwork.us9.list-manage1.com/track/click?u=72f3e834e2ba795522e617a94&id=5105256efe&e=8d0f2409c3
  13. Insurance: a three tiered step-by-step guide for your distillery I am asked constantly by folks from all parts of the globe (literally) as to how the insurance process should go, what they need, and at what point do they need it. Actually, I am asked about this so often that I decided to sit down for a few minutes and put it into post since there must be more folks out there wondering the same thing. For the purpose of this post I am going to only address the process for the US at this point and do so at a 30,000’ perspective as to not bog anyone down in the minutia of deeper subject matter. However, if you are in “some other place” or would like a deeper understanding of some piece of insurance please feel free to message me or email me as I do have quite an extensive knowledge of the process in several other lands and a deep understanding of the nitty-gritty nuances of all of the insurance aspects. Anyway, on to the process. The typical insurance process, step one: You are applying for your DSP and you run into the section where it is calling for the DSB (Distilled Spirits Bond) that you need to give to the TTB in order for them to process your permitting. This aspect of the “insurance” side of things is perceived as one of the scariest and most difficult processes to struggle through. I am here to tell you that simply is not the case. Many people have horror stories or have heard from someone that this was the worst part of the whole process. That the bonding screwed up everything and set them back months, or that when they were finally able to get through this horrible process the bond ended up costing them an insane amount of money. Although many of those stories are true and oftentimes people do lose precious time or they indeed pay an incredible amount of money for their bond, it all boils down to one thing; the person they are working with. Knowledge and relationships are king when it comes to bonding and anyone that has worked with these types of bonds for years on end should be able to assist you through the process in the matter of a few minutes. From assisting in the figuring of the taxable liability amounts, to the application process, this truly should not take longer than about 15-30 minutes start to finish. Once those “meat and potatoes” aspects are figured out and the applications are complete you should be able to have the executed bond form in your hands and ready for submittal within 24-48 hours. If you are working with someone who has the knowledge and relationships in this industry, the bond should be a done deal within a day to possibly a few days and should never come back to haunt you. Don’t get me wrong, there is a myriad of things that can go wrong and many ways that the bond can mess things up. If you have an insurance professional though that knows their way around the bonding and what the TTB is looking for and how to avoid the pitfalls and snares, it really is a one-and-done deal. It really is that simple. Find someone who knows what they are doing and you will not lose any time and it will be the cheapest thing that you purchase for your distillery, hands down. The typical insurance process, step two: You have either acquired a building or are obtaining a lease on a space and there is an insurance requirement. If you are buying a location it may be that the lending institution is requiring that they be named “loss payee/mortgagee” on your insurance as well as possibly “additional insured” status and they want a certificate or evidence stating such. If you are signing a lease, the landlord may have a requirement to be listed as “additional insured” or at the very least require a certificate showing that you have insurance. Again, if you are working with someone who has an understanding of distilleries and has a great product where you can add and subtract coverage’s, this should be a very easy step to accomplish. If you are in a “triple net lease” situation and are required to insure the building, again, it should not be an issue. This is basically all there is to the second step, the securing of insurance for the location and your business. The typical insurance process, step three: You are ordering your equipment and items you will need in order to get set up and running. Once you have a policy put in place to satisfy those items discussed in step two, this is a no-brainer. The equipment and contents side of the policy is one that should be very simple to accomplish. Watch out however as to how these items are listed and what “perils” or coverage is being offered and/or excluded. This is one area where a deeper knowledge of how things work within an insurance policy is key. Someone who knows what they are doing should be able to provide you with a better and lower premium on the equipment than what is available in regards to standard “contents” coverage. Without divulging all my trade secrets here I will simply say that there are a variety of “legal and ethical” tricks that can be used to keep your costs down while actually providing you better coverage. As well, at this time you may be in need of securing many other types of coverage in order to make sure that you are properly insured and protected moving forward. Liquor liability; Cargo coverage; Products and Complete Operations; Workers Compensation; and Product Valuation among many other things may need to be considered at this point. An agent with experience in this arena should be taking the time to discuss your business plan with you. They should find out where you are at currently in regard to your needs and where you see things progressing to anywhere from 6 – 18 months from now. This process will not only assist you with the “realization” of timeframes and considerations, but it will also allow the insurance professional the ability to plan ahead with you or address commonly overlooked insurability issues. Again, watch out for how these coverage’s are written. The product valuation is one of the biggest issues that I see being overlooked. Almost ever carrier in the country uses the same endorsement form to insure your product and for the most part it is very lack-luster. I personally have developed and had adopted an endorsement form that gives true value to your product in the way in which you and I decide it should, not how the insurance company “may” decide to value it. God forbid the unforeseen happens and you lose everything, including your product. That is not the time to ask the question as to how you were insured and what you can expect in the way of coverage. In conclusion, this is a rather simplistic overview of an overall more involved process. With that said though, if you are working with someone that knows what they are doing, it actually can be this easy. A few things to keep in mind: 1.) Know your insurance professional and their background/knowledge. Ask the hard questions, find out how much experience they have in doing this type of work and how many other distilleries they write. YOU DO NOT WANT TO BE THE GUINEA PIG! This is your business, your baby. Treat it as such. If you are not comfortable with their answers, move on. Beware of the agent that says, “Well …… I have written a brewery before. How different could it be?” R U N !!!!! I know I am preaching to the choir, but a breweries and distilleries are VASTLY different in so many ways, and the insurance is certainly one of those ways; 2.) Know what you are purchasing. People have a view of insurance often times that it is just “throwing money down a rat hole”. That it is one of those things that costs a lot of money and they never get anything for it. I understand, but keep this in mind ….. If you know what you are purchasing and the value it brings to you, you will not feel this way. As well, in a perfect world you hope it works out that way. That you pay money in for the whole life of your business and never get anything back from the insurance company. If they have to make a pay out that means that you have either hurt or killed someone or you have sustained an incredible life altering loss to your business. I am not talking about the roof claims or hail type situations, I am talking catastrophic here. If your insurance person makes you full aware of what you are buying, you should never feel as though you are getting ripped off. 3.) Keep in communication with your insurance folks. When you make a change or even better, when you are thinking about fixing to get ready to make a change, give them a call. There may be insurability issues in what you are thinking about. Even if there are no issues, you need to be sure that you have the protection you need to cover the change. Often times the insurance folks are the last to know and that is not good. Loop them in at least every 6 months or each time there is a “big” change coming. 4.) Do it well and do it up front. If you have a good professional that is more a business partner in a way than just an “insurance agent” you should be able to confide in them, tell them exactly what you are doing and what concerns you have. You should not feel like you need to hide anything or not give them all the details. Work with them as you would a CPA or lawyer. They are (or should be, if they are not, run again) a professional and will treat your information with the utmost confidence. Be open an honest and trust them implicitly. If you don’t, why are you doing business with them at all? 5.) **** DO NOT “SHOP IT OUT” **** This is one of those areas that really does not make sense to anyone in the insurance industry. There are people out there that will call 5 different agents and ask them for a quote. They want to “keep everyone honest” and they think by doing so it will ensure they get the best deal if they have multiple people involved. Stop. If you find someone that you are comfortable with that has the background and knowledge and that you trust implicitly, let them shop it for you. Bringing in multiple people only confuses things. Insurance carriers only allow one quote to go out to the first agent in the door. So if you go to five different people they are all going to try to get it out first and block the markets anyway resulting in what you hoped to avoid in the first place. You will then be forced to sign Agent of Record letters to allow other agents to obtain other quotes that some other agent blocked, blah, blah, blah. It is a nightmare for you, the agents and the carriers. Just don’t do it. Pick someone, one agent and work with them exclusively, end of story. I hope this information is helpful and valuable to anyone reading it. The insurance and bonding process should be easy and can even be fun if you get the right person. If you have any further questions or if you view me as being “that person” to assist you with your insurance needs please reach out to me. You can PM me here on the forums, email me at aaron.linden@hubinternational.com or call or text my cell at 307-752-5961. I truly am here to help in any way that I can and I am always happy to answer any questions that you may have. Have a great Memorial Day Weekend! Best, Aaron “InsuranceMan” Linden
  14. Esteemed Forum Members, I am pleased to announce that I, along with several others, have formed a core group of industry experts in order to better assist those in the craft beverage industry. This team is comprised of a body of experts that have a tried and true historical record assisting those in the craft beverage industry that has proven these members to be the best of the best. We have formed this group in order to positively promote the industry as a whole through best practices, best services, advanced education and unparalleled expertise. Given the incredible rate of growth that the craft distillery industry has experienced and continues to experience, there are a lot of people “jumping in” and trying to take advantage of the rapid expansion in order to make a fast buck. My opinion is that many of these people are diluting the industry as a whole via their lack of knowledge, lack of true understanding, and lack of experience and expertise. Becoming involved only to try and take advantage of a situation and capitalize on it only for personal gain is short sighted and I feel it is also intrinsically wrong. Many seem to be in it only for themselves and in the end only prove to be roadblocks that are a drag on the industry. They are not here to promote the craft distillery industry for the greater good; they are involved only for their own personal wellbeing. Our group of industry experts brings years of dedicated service, specialized products, and a true commitment to the craft beverage industry directly to you. One of the many benefits of this group is that we save you one of your most precious and valuable resources, time! Instead of having to spend countless hours of research trying to figure out who is reputable and who you should chose to work with, you now have a “one-stop-shop” of resources and we offer our services on a national level. While we all remain independent from one another, we work closely together as a group to best assist our clients and service their needs. You as the client though are free however to pick and chose which services you are in need of and can select to use any of us that you like. We are an expert resource group with a working knowledge of one another’s expertise and have an excellent rapport with one another. What this means to you is that if you have questions, we have answers. Our expert group is currently comprised of the following industries: Commercial Insurance / TTB Bonding / State Bonding: Aaron Linden – CIC, www.hublinden.com Product Design / Branding / Marketing: Leif Miltenberger, Hired Guns Creative www.hiredgunscreative.com CPA / Planning: Nick Shepherd & Kevin O’Brien, Irvine & Company, LLC www.irvinecpas.com Legal / Alcohol Compliance: Chris Hermann & Bernard Kipp, Stoel Rives, LLP www.stoel.com TTB Consultant / TTB Compliance: Charles Schumacher Architecture / Design / IFC: Mark Ward, Urbanadd www.urbanadd.com Distillery Operations / Product Development / Consultant: Daniel Feldman, Dodo Distilleries In closing, we are all very excited for this opportunity and the ability to bring our years of expertise and dedicated service to the craft beverage industry to all of you. I would encourage anyone reading this, from the start-ups to those of you who are well established, to reach out to any of us with any questions or comments you may have. The beautiful thing about learning is that no matter if you are new to the industry or if you have been in it for a while, things are always changing and there is always something new to learn. Let us be your resource for learning and let’s positively grow this industry together for a sustainable and successful future.
  15. Do you “Have” insurance or do you “Acquire” insurance???? Let us begin by reviewing the definition of each of these words: have/hav,həv,(ə)v/ verb be obliged or find it necessary to do the specified thing. ac·quire/əˈkwī(ə)r/ verb obtain (an object or asset) for oneselfInteresting. The reason I bring this up and write this post is mainly due to the fact that there really are two varieties of distilleries found across this great country of ours (sorry if you are outside of the U.S., you are welcome to keep reading but I am focusing just on America at this point, sorry). There are those craft distillers who “have” insurance and those that “acquire” insurance. In my dealings with folks all across the country, from Alaska to Hawaii, from Maine to Florida and every known single point in-between, I have found that everyone I talk to falls into one of these two categories. Let us start with the “have” to people first. The people in this group seem to be the ones that are a bit put out due to the fact they feel victimized by the insurance process. Hearing things like, “Well!!!! I HAVE to have insurance because the stupid bank/landlord/government/name-some-other –random-entity is MAKING me, otherwise I would just go without!” This is very common with people in this group. The unfortunate reality is that these people either have not been properly educated in the insurance process and simply do not understand its beneficial function to them or …….. they are just crabby and they DO understand insurance but they still hate having to have it. Noted. “I pay all this money every year and never use it! What good is that, I could use that money for other things.” I have heard that so many times that if I had a nickel for each one I wouldn’t be here writing this; I’d be in Belize fishing right now. The first thing to realize is that insurance is NOT a waste of money, it is a way to protect you assets. In all reality insurance is a very safe and reasonably cost effective way to spread and mitigate your single risk against loss across a broader spectrum in exchange for a premium. In fact “insurance” is defined as: Insurance Definition A risk-transfer mechanism that ensures full or partial financial compensation for the loss or damage caused by event(s) beyond the control of the insured party. Under an insurance contract, a party (the insurer) indemnifies the other party (the insured) against a specified amount of loss, occurring from specified eventualities within a specified period, provided a fee called premium is paid. In general insurance, compensation is normally proportionate to the loss incurred. Some types of insurance (such as product liability insurance) are an essential component of risk management. Exactly. “…. an essential component of risk management.” I ask this question: would these same people notice a potential issue within their own distillery that could become a potential hazard or be a risk to their losing everything they have worked so hard to build, yet choose not to fix that issue unless someone was forcing them to? Of course not, most would be proactive and fix the issue and avoid or mitigate the risk. Well the same applies to insurance. Insurance simply cannot be looked at as something that is being forced. Instead, one should realize that insurance is actually there to be a benefit in the case of an unexpected event. Some of these same folks will choose to “self-insure” those aspects that are not being “forced” upon them. Often, they will need to comply with a landlord’s requirements, or get insurance to satisfy a bank loan, but that is where it ends. They will “self-insure” their property (stills, equipment, etc.) as well as their product. What they don’t understand is there is a lot more to insurance than meets the eye. Let us take for instance products coverage; product recall coverage; and liquor liability. What if these same folks are bottling their product and during the course of the process they nick the neck of the bottle, inadvertently sending glass shards into the product? They then send the product out without knowing and someone ingests some of the glass causing injury? Well, in this case, if they do not have products liability or some product recall coverage, they are going to have to foot the entire suit and recall costs out of their pocket. Payment of damages to the injured party; the cost of recalling the rest of the batch that could potentially be affected, etc., could be very costly. This could ruin many new or smaller distillers and potentially cost them their business. This whole situation however could have been mitigated via the proper insurance policy. If they would have had the proper coverage they would have not only coverage for potential lawsuits but they would also be afforded defense coverage for those suits. As well, their product recall coverage could be paid for (up to the limit purchased) and they could stay in business. The same goes for liquor liability. What are the chances someone may be potentially sued for causing someone to become “over served” on their product resulting in a lawsuit? I have seen this happen and even if the party was not found to be negligent the legal cost of proving themselves not guilty can be staggering (pun intended). The rule of thumb is, if you don’t have the coverage, you don’t have the defense. As well, if they choose to “self-insure” their equipment they are then beholden to having to buy it again should a loss occur. Insurance premiums on equipment, when written correctly, can be less than half a cent on the dollar! Well in my book that is a sound investment in the way of protection of your assets. That is simply not “throwing money away”. Given, there are a myriad of coverage’s and one needs to keep things in check as to not become “insurance poor” but again, this is where the education piece comes into play as well as knowledge on the part of the agent. If these folks “have” to have the coverage and choose to buy low and not know or care what is really covered, you have to wonder what other corners are being cut. This brings us to the “acquire” crowd. Oh how I enjoy these folks. These are the folks that get it, or at the very least they want to get it. They are the ones that ask the questions and will actually LISTEN to the answer because they want to know. These are the folks that will take an active role in the decision process and acquire the correct insurance product to fit their needs. The folks in this crowd understand that insurance is not a waste of resources but that it truly is an asset and protection that is there to assist them in their greatest time of need should it arise. The “acquire” group understands the value of what they are purchasing weighed against the cost of doing so. They are effective buyers that are still keeping an eye on their money but know how and why they are spending it and what they expect in return. They also understand that their insurance professional is a trusted confidant, a true business partner that they work in unison with in order to protect and grow their greatest asset. They are not foolhardy with what they will pay in the way of premiums but the dollars they do spend they know are in the best interest of their business. In a way, these folks have reached “Insurance Nirvana”. Often times they don’t necessarily start out that way, although some do. Some are born savvy insurance buyers but most “acquire” this skill over a period of time or through trial and error. I have two suggestions to anyone reading this post. The first would be this; if you are one of the “have” folks but would like to move closer to the “acquire” group without needing to experience the trial and error process, give me a call. I am careful to never say I have seen it all and done it all but I have seen more and done more than most anyone else. I have been doing this for a very long time and can easily lead you to “Insurance Nirvana” via the scenic highway route as opposed to the bumpy and slow dirt road that many insurance folks are on. Second suggestion; if you are in the “acquire” group, kudos to you. You are well on your way to being a happier person, comfortable with who you are and where you are going in terms of insurance and you will have a greater experience in the long run. For you savvy individuals I would still suggest you give me a call. I have the only product available that gives you what you really need (read this post: http://adiforums.com...?showtopic=4883 ) in order to experience true “Insurance Nirvana”. I am here to assist you, guide you, and if you have a great insurance product at a great price then I am even here to tell you, “Good job savvy insurance buyer, you have truly acquired Insurance Nirvana.”
  16. DistillingInsurance

    Hello from West Chester, PA

    Good afternoon all. New Member here. Just wanted to introduce myself. I'm an insurance agent in West Chester, PA and I specialize in the insurance for Distilleries & Breweries. We own DistillingInsurance.com and insure more than two dozen breweries and distilleries in PA, NJ, NY, DE and MD. I've been in the business 8 years now and Craft Beverages have been a passion of mine for many years, so I decided to make that my career, in the form of Insurance. Our agency has the relationships with multiple insurance companies that are very familiar with the craft beverage world. Please call, email or respond to this thread anytime with any questions. I'd love to chat. Happy New Year and Cheers! Kyle Rheiner (@insuranceguyKR) 610-217-8685 kyle@distillinginsurance.com
  17. InsuranceMan

    Distillery on the Moon

    ***** INSURANCE UPDATE ***** ******* 10 / 10 / 14 ********** ** DISTILLERY ON THE MOON ** Picture this if you will, a craft distiller that is making a wonderful multi-year aged product that is as smooth and richly complex in flavor as anything you have ever had the pleasure of having cross your palate; A multimillion dollar facility with one of the most beautiful, multiple story tall, hand crafted stills that you have ever seen; A cache of their distilled products with a value in the multiple tens of millions of dollars. Sounds pretty great right? Maybe it sounds like a goal that you hope to one day achieve for your own business? Now take this real life scenario and place this facility on the moon. Did I lose you there? Did I really say that this facility with all of this value and all of this product was on the moon? Yes I did. However, I am speaking metaphorically. This situation really, truly does exist in regards to a client of mine. They have the facility. They have the beautiful still. They have a large cache of their product built up for current and future demand, but for all intents and purposes their distillery is located on the moon. Well, at least that is what 99% of the insurance companies think. Recently I had the opportunity to work with a long term and very good client of mine in order to arrange for new insurance coverage for their ever growing and expanding craft distillery. There were many issues that needed to be overcome such as the value of their buildings (it is quite a lot), the value of their products on hand (but I am the only person in the country that has that figured out as well, see my post and read the whitepaper here: http://adiforums.com/index.php?showtopic=4883), but the biggest issue was their location. I marketed this account to every single insurance carrier I could find that purports to have a “special craft distillery/beverage” program. I was met almost immediately with declinations or comments of, “You have to be kidding, right?” One underwriter with a company who has a “special program” even told me, “This thing may as well be on the moon! There is no way we would touch this risk.” And on it went. EVERY carrier that I spoke to had a reason to not write this account. From the values being too high on the location (that carrier has a very low limit that they can accommodate “per location”, but they have a cool name that sounds like they want to write distilleries); To carriers saying that they just simply cannot accommodate something of this size; To the location of this clients operation (basically on the moon); To the fact that even though “they” have a special program, they are just under-gunned to actually write this kind of risk; Or that they could not get this past their ReInsurance company; To the fact that they only handle very small to moderate risk size (this has been a problem with a lot of distilleries, their carriers drop them when they actually get too big). The odd thing is, many, many clients fall into this category of size. So what are these clients to do when they either outgrow their carrier or are told that a number of carriers only write “rural risks but there has to be adequate fire protection” (two things that do not go hand in hand)? They are to turn to me! Of course I contacted the carrier that I have my exclusive program through, spelled out the details of the account, the fact that we needed my increasing and progressive valuation for their aging stock on hand, and you know what???? They did not even blink. No snarky comments about the “moon-like” location, no problems with the value, no issues with the lack of fire suppression and even better, they could do it in house without worrying about a reinsurance company riding them over the placing of the account! Within a week’s time we had a bindable proposal that we were able to execute in a timely fashion without missing a beat. The reason I wanted to tell this story is simply due to the fact that, as I have said before, just because an agent or carrier may be able to place a risk does not mean they should. Do your checking prior to buying your coverage. Is the carrier someone that is going to drop you in the second or third year due to your increasing size? Does the agent even really know your business and how to handle it properly? What happens in the case of a loss to your stock on hand? Just because a carrier has a “shiny” name with “craft” or “specialty beverage” or “distillery” in it does not mean they are a perfect fit for what your needs may be. Currently 99% of the carriers in the country use almost the exact same forms and endorsements to write craft distillers but those forms and endorsements in many cases do not provide adequate coverage for your true risk and at that point it just boils down to premium dollars (see this post: http://adiforums.com/index.php?showtopic=5245&hl= ) . In the end though, those premium dollars mean nothing if they are being spent on lackluster coverage. From the very smallest of start ups, to those who have been in the industry for many year that are located on the “moon”, urban or rural, and everyone that is growing and in between, I can assist you. This is not a shameless self plug (well, not entirely) but a true plea from an experienced professional: Do your research, know what you are getting and make sure you have someone with experience in this industry that can go to bat for you should something happen. That is what you are spending your premium dollars for, make them count. From one room “mom and pop’s” to multimillion dollar facilities on the moon, make sure you are protected by someone and by a carrier that fully understands your exposure and by someone who is in this not to make a quick buck, but by someone who is doing all they can to better the industry as a whole ( see this post: http://adiforums.com/index.php?showtopic=5465) . After all, “It is one small step for craft distilleries, one giant leap for distillery-kind”.
  18. Holy cow! This white paper has really stirred up a lot of discussion and questions from many forum readers, posters and lurkers!!! That is great, it is meant to make you think, make you question and make you more aware, so all-in-all it has done exactly what I was writing it to do. I just wanted to address a few key issues that seem to be at the heart of many of the conversations I have with folks in regards to my white paper, the insurance industry and what I am doing differently then everyone else.   I am NOT saying your coverage is wrong or your agent is wrong. A lot of people are now thinking they have been taken advantage of by their past agent or carrier based on the fact that they are now learning that they really may not have been covered appropriately up to this point in time. Others think their agent may have purposefully misled them into believing that they were buying the "best" coverage available. This is most likely not the case. More likely an explanation is that at the time in which many folks had bought their insurance it may have been the "best" thing out there or at least a good attempt. However, I have changed that for ever. What use to be considered the "Market Standard" and the form that everybody used to try to cover things correctly I changed to make it antiquated and something that still can be applied and used, but it is no longer the "best" thing out there. If you are wondering what I am talking about please do review the whitepaper attached to this posting. My product valuation is vastly different from the "standard" used in years past and is still currently being used by a majority of the companies and agents today.   As far as an agent purposefully misleading you, I certainly hope not. What it truly boils down to in my experience, and I have been doing this a long time, is that many agents just don’t know what makes distilleries and their products unique and how to correctly cover them and deal with the intricacies they present. Many agents I have dealt with mean well (I think) but they say things like, "Well, I have written breweries/wineries for a few years so I thought I would get into distilleries." Again, often times they just don’t understand the difference. Also, there are many agents who only write your distillery, or maybe a couple of distilleries, but often times they are generalists who write insurance on everything and anything without specializing or gaining the knowledge needed to really handle or understand your needs. I’m not saying that is wrong, but someone like me who writes distilleries on a national level and who has taken the time to developed a customized insurance program based on real needs seen from YOUR daily working distillery level just knows better as to what is actually going on, how to insure you correctly, as well as has a passion to do so.   Again, I am glad that this paper has had such an impact on folks and that there are that many of you out there thinking about your insurance now and asking questions. I truly feel that aside from your people and your product, insurance is a "top priority" focal point (or should be) for your distillery. Your people and your product are what make you successful but your insurance keeps those investments safe and protects you from losing everything. As always, please feel free to get with me to give me comments, concerns or simply ask questions. That is what I am here for. As well, my offer always stands to give a no obligation analysis of your current insurance coverage. If you don’t know what you have or if you are not sure if you are getting the straight answers feel free to reach out to me at any time on my cell phone at 307-752-5961.
  19. What can we all learn from the recent tragic and damaging earthquake in the Napa Valley region a few weeks back that effected many wineries (and distilleries) in regards to insurance? Well, for one, earthquake itself is not a covered peril under any standard commercial property insurance policy. In the specific language of a Special Form Coverage Part (an aside here, you should make sure that you are covered on a Special Forms Coverage on your current policy) all causes of loss are covered except those that are excluded. Exclusion ( b ) on the Special Form Cause of Losses (Commercial Property Form CP 10 30 04 02) specifically excludes Earthquake. Earthquake however is not limited to simply just "Earthquake". "Earthquake" is defined as earthquakes, landslides, mine subsidence, earth sinking (but sinkholes themselves are covered) and volcanoes. Obviously, if you are located in an area that is prone to earthquake activity it would certainly be time well spent to check into an earthquake policy if you do not have one. The broadest coverage available is called a Difference In Condition policy or a DIC. A DIC is designed to broaden coverage for specific perils that standard markets do not provide adequate, if any, coverage limits for. Usually these are used to insure against perils such as flood and earthquake but do also have other applicable uses. In regards to a DIC that covers the earthquake peril the standard deductible can range anywhere from a standard 5%-10% but can be a high as 25% of the Total Insurable Value (TIV) per unit or location. This deductible can seem high especially in regards to a multimillion dollar loss like those seen on some of the regions larger wine producers (where the deductible could be anywhere from $100,000 to $500,000 depending), but it is certainly better than getting no insurance assistance as was the case with many of the folks in that region. Another issue that has reared its ugly head due to this incident is one that I have pointed out for years, the valuation of your product or stock on hand. Under the Commercial Property Endorsement form CP 99 05 06 95 (another aside here, make sure you at least have this form on your policy. Selfless plug here, I have an exclusive coverage form that I offer that is far superior to this, but at a minimum you should at least make sure you have this form, but you need to talk to me to get the very best available coverage) which is titled "Distilled Spirits and Wines Market Value" and in short it says that the insurance company will determine the value of your product at the time and the place of the loss based on potential "Market Value". I don’t know about you, but I personally do not want the insurance company telling me what my product is worth after it is already gone, that sounds like a losing proposition doesn’t it? Scarier yet is the fact that this endorsement never clearly spells out the actual value or settlement procedure that one could expect should there be a loss. The from that I offer is the only form of its kind that allows us to schedule the actual value of the product/stock on hand on a progressive valuation scale throughout the maturation process or for the product that you have on hand (I have the ability to value aging as well as non-aged stock). Also, my form waives all co-insurance penalties that would be associated with the product/stock coverage in the case of a loss. Now in regards to the earthquake, it really is a moot point in the fact that earthquake would not have been a covered cause of loss anyway. However it does raise the question about how would this impact you during a covered peril. Under the standard form that every other company uses (CP 99 05 06 95) my assessment is, not very well. In regards to the vague "Market Value" language seen in that form, this can be a large issue for a lot of startup distilleries or for that matter, ones that have been running for years but that are adding new products. In the case of a new product or new maturing products often times there is no established "Market Value". Take for instance a start up distillery that is making a 4 year aged bourbon (it has happened, I have worked with several). If they were to sustain a loss to their inventory in the 3rd year of the 4 year maturation process, what is the "Market Value"? That is the big question. Technically under the CP 99 05 06 95 form there is no established "Market Value" since the product has never been to market in order to establish said value. That form then stipulates that the value could be "The market price per proof gallon of equivalent bottled distilled spirits as of the time and place of the loss or damage". If you are a true craft distillery, there really is no "equivalent", is there? At least you would hope there isn’t. Do you want to run the risk of only gaining reimbursement based on the price of what one of the big distributors gets for their lowest bulk sourced product? I would imagine the answer would be no. With my exclusive form, based on the product, the time maturation element (or stock on hand) and the product/stock reports that are kept it is easy to determine the exact value and the loss and what would be recuperated should the unforeseen take place. That is why I developed this product, so that everyone can sleep at night knowing everything is covered the way it should be. The valuation of your product/stock on hand is one of the most misunderstood and under insured coverage’s for many distillers and it is the one that should be the most focused on. Knowing what you are covered for and how it is valued should be at the forefront of your concerns. In closing I would suggest that if you are in an area prone to natural disasters that are excluded under standard commercial property policies such as earthquakes, flooding, hurricanes, etc. you need to speak with an insurance expert about how to best protect yourself against these situations. As well, it would be time well spent on your part to protect you investment of time, passion and capital and review your current insurance policy to see what is really covered in the case of a loss. Do you have the "Special" coverage form; Are there any other forms or endorsements that protect your product/stock on hand; What are the deductibles or co-insurance clauses associated with a loss; What gaps may there be in your policy; and what has changed over the years in regards to value of your assets whether it be addition of equipment or amassing more aging stock. The sad reality is many insurance "professionals" are able to provide policies for a myriad of risks but that by no means suggests that they should. Find a true insurance expert that fully understands your risk and make certain that the premium you are paying is actually worth the price you are paying for your protection.
  20. Good Day Dear ADI'ers, I am about as excited as a kid on Christmas morning (or any other holiday as to not exclude anyone)!!! I was just on the phone with the TTB (a few different times to make sure that the answer was the same multiple times) and was assured that the process for submitting your TTB DSP bond has now become a very simple process for those of you doing your permit application on line. Back in April the TTB had announced that they would consider doing the full application process on line, however it seemed that no one really knew how they would treat what I consider on of the biggest factors .... How they would treat or process the bond. A little history for those of you new to the process ..... Back in the day the TTB would require for the Surety (or insurance agent) to process the Distilled Spirits Bond, attach a power-of-attorney form, crimp seal the Bond form, sign it and send it off to the distillery (in duplicate) in order for it to be considered an "executed bond form". Then the authorized party at the distillery would have to sign each copy and submit both copies to the TTB in Ohio for approval. Once approved they would keep one of the bond forms and send the other back to you at the distillery for your files. Fast forward to today ....... The TTB will now allow for the insurance agent (me of course, if it is anyone else we really need to talk) to still execute the bond form in the same manner but now once I have sealed it and signed it I can send it to you in an electronic format (most likely a PDF), then you can simply print it off, sign it and have it witnessed or sealed with your corporate seal if you have one, simply scan it again into a PDF and upload it as an attachment. Only one copy now, not duplicates and viola!!! No more having to overnight things to get them there in time. No more having to duplicate all of the work and make sure each copy is EXACTLY, PAINSTAKINGLY the same for fear of the TTB rejecting it. No more worrying that it may get lost in the mail with out a tracking number and delay the process. Man, if you are a craft/micro distillery and insurance nerd like me you are geeking out right now. This literally gives me (because I am InsuranceMan, super insurer of the universe) the ability to take these bonds from the application process to approval to the executed bond in your hands in an electronic format all within about 24 hours! See, I'm geeking out here but this is really great. Taking this process down from what use to be several days if not weeks to a day, that is good stuff. Oh what a great time in which we live. As I have said before, I am always working to improve your insurance experience. I encourage anyone with a pre-existing bond or a need for a first time bond or anyone in-between to give me a call. I know more about bonding and insurance than dang near anyone else in the country and my program and rates are unbeatable. If you have not read my white paper posted on the form, do it! I look forward to working with anyone on their bonds and insurance needs at any time. Feel free to call me on my personal cell phone at 307-752-5961 and let me show you what makes me the super insurance hero that I am.
  21. InsuranceMan


    Hey, I just wanted to give another shout out, this time to Millstone Spirits, Clawhammer Supply and Orcas Island Distillery and say thank you for allowing me to be your trusted insurance agent, adviser, and consultant. I also want to thank everyone else who has reached out to me and for all of those of you who I am in the "process" with. Seriously, the support and inquiries of the folks here on the forum has been amazing and being able to work with you has been a wonderful experience. We just keep insuring more ADI-er’s every day and I am so grateful to be able to help you all out.   Remember, from the planning stages to those who have been running for years, I can assist you. No one else has an insurance product that will cover you like mine, that is the truth, I worked for 5 years to bring this product to your industry and I am the only one that has it. Also, my TTB bond rates seem to be the very best around, so if you are in need of a new DSP Unit bond or if you just want to price shop give me a call. Again, thank you to everyone out there (from distillers to other vendors) for making my insurance program for you such a HUGE success. Have a great week!!! Oh yeah, if you have not seen it yet, go here ( http://adiforums.com/index.php?showtopic=4883 ) and read my "white paper" explaining why my insurance product is so different. It should blow your mind.
  22. InsuranceMan

    Always working to improve insurance

    Dear Forum Readers, DATELINE - TODAY (5/7/14) In my daily insurance-superhero saga to bring you the most up-to-date and most well enhanced insurance coverage available, I am pleased to announce that I have been able to create and provide a new endorsement to my already outstanding line of insurance coverage! Released today is an endorsement that will provide for up to $100,000 worth of "annual aggregate" coverage for "leakage" for direct physical loss or damage to aging bulk distilled spirits or bottled and packaged spirits. "Leakage" is defined as a discharge by seepage, release or escape. However it will not pay for "leakage" which may reasonably be considered customary to the trade or a shortage found on taking an inventory (the angels still get their share, sorry). This endorsement is written on a "Cause of Loss - Special Form" (only the best I say) and the standard property deductible would apply. This form is currently the highest available limit with the broadest coverage that I am aware of in today's insurance marketplace. If you are not certain about what your current insurance policy covers or if you simply would like to discuss my exclusive and unique insurance product I would invite you to give me a call. No one else anywhere can currently offer you what I can in the way of insurance product and expertise (and knowledge of TTB Bonds); I guess that is what makes me "InsuranceMan", defender of micro and craft distilleries throughout the country!
  23. Brothers Vilgalys Spirits

    Liquor Liability Insurance for Tasting Rooms

    So we're just seeing our product on shelves locally here in NC (hooray!), and soon I'll be opening up the tasting room on Satudays. My insurance company is emphasizing the need for liquor liability insurance, which carries a minimum cost of $1,000 / year. That seems extra-ordinarily high to me, especially because it's a policy designed for bars / restaurants. Pouring a single .5 oz sample is a pretty different, and I've tried to explain this. How many tasting rooms bother with this extra insurance? I'll be open 4 days a month, serving a third of a drink. It just doesn't seem like the risk/reward is really favorable here.
  24. CopperPig


    I know of several distillery specific insurance companies, but none that cover California. Does anyone have a recommendation on an insurance company that writes policies for California? Who do you folks use? Best, Tyler
  25. Scapigliatura10

    Question about insurance

    I have completed my business plan I am currently in the process of paperwork for licensing. However, I am having trouble getting accurate cost estimates for insurance. I have contacted several of the insurance providers that have been discussed within this forum, but they cannot give me a ballpark figure without a lot of information that might still be subject to change. Does anyone mind sharing ballpark figures for what their monthly insurance costs are? I will have no employees, and not have more than 250 gallons of product in house at a time. Thanks.