Beer and ale wholesalers & distributors insurance helps protect your business against third-party injuries, faulty products, damaged or stolen inventory, injured employees and other specialized risks. Get information on costs, coverage options and more.
Beer And Ale Wholesalers & Distributors Insurance
Beer and ale wholesalers receive packaged goods from foreign or domestic distilleries for distribution to package liquor stores, grocery stores, restaurants, concession stands, and other retail establishments. The distribution center may be open 24 hours a day. Generally the product is delivered to the customer on the distributor’s vehicles.
As a beer and ale distributor and wholesaler, you definitely have a super cool gig. There’s nothing better than knowing you are supplying restaurants, bars, pubs, lounges, and any other facility that serves adult libations with the products that they need so their customers can have a good time.
While your job is definitely cool and certainly invaluable, being a beer distributor comes with a lot of responsibilities. It’s important that you protect yourself from the many liabilities that are associated with your business. What’s the best way to do that? Make sure you have the right beer and ale wholesalers & distributors insurance.
What Common Risks Do Beer And Ale Wholesalers Face?
Without a doubt, liquor liability is one of the biggest risks you’ll face. If anyone is involved in an alcohol-related accident, and it’s determined that you were the supplier of that alcohol, you could be held responsible.
Alcohol-related accidents aren’t the only risks you face; if a third-party is injured on your storage facility or while your supplies are being transferred from your location to a restaurant, bar, or whatever the final destination may be, you could also be held liable. Furthermore, you’re responsible for any damages that your commercial space may sustain, including fires, toppling trees, vandalism, and theft.
These are just some of the risks that beer and ale distributors face. As such, insurance is vital. It prevents you from having to pay the cost of any damages or injuries that you are deemed responsible for out of your own pocket, thereby preventing you from serious financial trouble. In addition to the financial security beer and ale wholesalers & distributors insurance offers, it’s also a legal requirement. If you aren’t insured, you could end up facing stiff penalties; your business could even be shut down.
What Type Of Commercial Insurance Do You Need?
There are several types of beer and ale wholesalers & distributors insurance coverage that should be in effect. Some of the basics include:
- Liquor Liability – Any business that sells alcohol needs to carry liquor liability insurance. This type policy offers coverage for any alcohol-related injuries that result in third-party property damages and bodily injuries, as well as any legal costs that may arise.
- Commercial General Liability – This type of insurance protects you from third-party injuries and property damages that aren’t related to alcohol; slips and falls, for example.
- Commercial Property – If your wholesale distribution center is damaged in a fire, is vandalized, or is damaged in any other way, commercial property insurance will cover any repair or replacement costs.
- Business Auto – You’ll also need to carry commercial auto insurance to protect deliver vehicles, drivers, and anyone else on the road from any accidents that your cars, vans, or trucks may be involved in.
These are just some of the types of beer and ale wholesalers & distributors insurance coverage you should carry. You can carry individual policies, or opt for a comprehensive policy that combines several different types of coverage under a single policy.
Minimum recommended coverages: Accounts Receivable, Business Automobile Liability and Physical Damage, Business Income and Extra Expense, Business Personal Property, Computers, Contractors’ Equipment, Employee Benefits, Employee Dishonesty, General Liability, Goods in Transit, Hired and Non-Owned Auto, Umbrella, Valuable Papers and Records & Workers Compensation.
Other coverages to consider: Building, Computer Fraud, Cyber Liability, Earthquake, Employment-Related Practices, Equipment Breakdown, Flood, Forgery, Leasehold Interest, Money and Securities, Real Property Legal Liability, Signs & Stop Gap Liability.
Exposures And Risks Of Beer And Ale Wholesalers & Distributors
Property exposure comes from multiple ignition sources, open construction, and the combustibility and the damageability of the beer and ale and packing materials. Ignition sources are from electrical wiring, equipment, and refrigeration units. All wiring must be well maintained and up to code for the occupancy. The age, condition and maintenance of coolers and refrigeration equipment are important to review.
Ammonia leaks could cause an explosion. There should be detection systems, emergency shut-off valves, and exhaust systems to allow venting in the case of a leak. Ammonia pipes should run outside the building to prevent accidental collision with forklifts inside the building, and have impact barriers around them to prevent contact with vehicles. Alarms should be in place to warn of power outage or shutdown. Backup generators should be available in case of equipment failure.
Good housekeeping and fire controls are critical. Smoking should be prohibited. Even a small loss can cause all stock to be condemned by the FDA due to possible heat, smoke or water contamination. If there is a sprinkler system, heads must be located high enough to avoid accidental contact with forklifts. Recharging of forklifts and maintenance of vehicles should be done in a separate, ventilated area away from combustibles.
Beer and ale may be a target for thieves. Appropriate security controls must be taken including physical barriers to prevent entrance to the premises after hours and an alarm system that reports directly to a central station or the police department.
Business income and extra expense exposures are high. Recovering from a loss could require a lengthy time to rebuild the facility and purchase replacement refrigeration equipment. Business income from dependent properties is a concern because most beer distributors work with only one manufacturer.
Equipment breakdown exposures are significant as temperatures must remain constant for refrigeration equipment. All equipment must be inspected and maintained on a regular basis. Backup generators should be available. Additional coverage for spoilage and ammonia contamination should be considered as even a small power interruption could result in a large loss.
Crime exposure is from employee dishonesty. This operation involves a number of transactions and accounts that can be manipulated if duties are not separated. Background checks, including criminal history, should be performed on all employees handling money. Regular audits, both internal and external, are important in order to prevent employee theft of accounts. Physical inventories should be conducted at least annually.
Inland marine exposure is from accounts receivable if the distributor offers credit to customers, computers for tracking inventory, contractors’ equipment, goods in transit, and valuable papers and records for manufacturers’ and customers’ records. Duplicates must be kept of all data to permit easy replication in the event of a loss. Contractors’ equipment includes forklifts, cherry pickers, and hand trucks used for moving stored items.
While goods may come to the warehouse via common carriers or trains, goods are generally delivered to retailers on trucks owned by the distributor. Goods in transit are subject to breakage losses from collision or overturn. Due to the potential for theft, vehicles should be unmarked, have alarms and be attended at all times.
Premises liability exposure is generally limited due to lack of public access to the storage facilities. If customers pick up goods, loading docks must be clearly marked and user-friendly. Customers should be confined to specific areas that are kept clean, dry and free of obstacles. Contracts with transportation and storage providers may expose the operation to additional liability. Railroad sidetrack agreements pose additional concerns. If there is a railroad sidetrack or dock, an employee must verify that no one is in the path of an incoming or outgoing train. Railroad tracks and conveyors can be attractive nuisances. The premises should be enclosed by fencing with “No Trespassing” signs posted.
Products liability exposure is low if products are all from domestic manufacturers. All products should be dated and stored as required by the manufacturer to allow easy access in case of recall.
Environmental impairment exposure can be high due to ammonia and other refrigerants and fuel tanks used to service vehicles. All underground tanks and pipes should be routinely tested for leakage. Spill procedures must be in place to prevent the accidental discharge of contaminants. Contracts should be in place to dispose of all environmentally dangerous chemicals. Record keeping is critical.
Liquor liability exposure is low if tours are not permitted and samples are not given out. All serving of alcohol must comply with state and federal regulations. Employees must be trained to recognize signs of intoxication.
Commercial auto exposure comes from the salespersons’ fleet and delivery vehicles. There should be written policies on personal and permissive use of any vehicles provided to employees. All drivers must be well trained and have valid licenses for the type of vehicle being driven. MVRs must be run on a regular basis. Random drug and alcohol testing should be conducted. Vehicles must be well maintained, including refrigeration systems, with records kept in central locations.
Workers compensation exposure is very high. Lifting injuries such as back pain, hernias, sprains and strains are common so workers should be trained in proper lifting techniques and to use conveyances. Forklift operators must be properly trained. Shelving must be stable to prevent stored goods from falling onto workers. Leaking ammonia is a serious health hazard that can lead to lung damage or even death.
Protective breathing equipment must be available to all workers in the event of any ammonia leak. Floor coverings or coatings may be slick and accumulate condensation, posing slip and fall hazards. Housekeeping is critical. To avoid frostbite and hypothermia resulting from exposure to sub-zero temperatures, the length of time spent in refrigerated areas must be limited, and protective clothing required.
Insurance Classification Beer And Ale Wholesalers & Distributors
Commercial insurers classify air conditioning and heating wholesaler and distribution businesses using several coding systems. You can wind up paying a lot more for your insurance premiums if your distribution business is not properly classified:
- SIC CODE: 5181 Beer and Ale
- NAICS CODE: 424810 Beer and Ale Merchant Wholesalers
- Suggested ISO General Liability Code: 10141
- Suggested Workers Compensation Code: 7390, 8018
SIC Code 5075 – 5181 Beer and Ale
Here is the official OSHA SIC code description:
Establishments primarily engaged in the wholesale distribution of beer, ale, porter, and other fermented malt beverages.
- Beer and other fermented malt liquors-wholesale Porter-wholesale
Get A Wholesalers And Distributors Insurance Quote
Not all beer and ale wholesalers & distributors insurance polices are the same. If you are shopping for new insurance, or just want to see if you have the best fit policy, let one of our expert agents take a look at your situation. In most cases we can save you money and offer you better policy options than you currently may have.
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