Packaged wine shops are primarily engaged in selling a wide variety of prepackaged wine that is not for consumption on the premises. If you own a wine shop, you may sell domestic wines as well as wines from France, Italy, Australia, and around the world. Your customers trust you to offer information and advice, as well as top-notch service as they search for the perfect Pinot Noir, Cabernet, and other popular and rare varieties of wine.
You might also sell wine glasses, aerators, corkscrews, decanters, and other wine-related items and novelties.
Owning your wine shop comes with a number of serious risks, from shoplifting and vandalism to fires and severe weather. What’s more, if you own a wine shop you’re always at risk for being sued if someone is injured as a result of shopping in your store or as a result of some aspect of your operations.
That’s why you need a comprehensive packaged wine shop business insurance program that covers your unique risks and protects you from large losses that could bankrupt you. A local independent insurance agent can help you find the policies that fit your needs and budget.
Why Do You Need Packaged Wine Shop Insurance?
Owning a wine shop can be risky. Your wine shop insurance can help you recover financially if you face a serious loss after a fire, a natural disaster, or a lawsuit. Some of the biggest risks that you need to address with business insurance include the following.
- Property damage: Your building and everything inside it, including inventory, computers, furniture, fixtures, and office space, can be damaged in a variety of ways. A severe storm can cause widespread damage to the outside and inside of your store. And even a small fire can completely destroy your inventory and force you to close while you make repairs and replace damaged property.
- Theft and crime: Wine shops are particularly susceptible to theft and crime from outsiders, as well as from employees. You might have a lot of cash on hand, and you may even sell some very rare and expensive bottles of wine, making you a desirable and easy target for thieves and dishonest employees.
- Customer or general public injury: Simple slip-and-fall injuries are common in any retail environment, and more serious injuries can occur, too. In the worst-case scenario, you won’t just be responsible for direct medical bills for the injured party. You could be sued and forced to pay for your legal defense as well as financial payouts to the injured person or persons.
- Employee work-related injuries: Whether your employees are unloading shipments and stocking shelves or simply working the cash register, injuries can happen at any time. If an employee sustains a work-related injury or illness, you’ll be responsible for paying for their medical bills and lost wages if they have to take time off from work to recover.
There are numerous other risks you face as well, including:
- Breakdown of machinery or equipment, including coolers or other wine refrigeration units
- Selling contaminated products
- Liability claims related to selling alcohol
- Using your personal vehicle for company business
- Visitors to your store can cause damage to bathrooms, display cases, inventory, or equipment
Why Do You Need Property Insurance for Your Packaged Wine Shop?
Property insurance covers your physical assets when they are damaged or destroyed by some type of covered loss, like a fire or a severe storm. There are several types of business insurance policies that cover your commercial property.
Commercial Property Insurance
- Covers your building (if you own it), as well as its contents, including all of your furniture, computers, office furniture and supplies, inventory, paper products, and indoor signage.
- Responds when there is a fire, storm, theft, or vandalism in your store and your commercial property is damaged or destroyed.
- Example: Alcohol is highly flammable. What might be a small fire in another environment could quickly turn into an inferno if your inventory is involved. If a fire damages part of your store or you have a total loss, commercial property insurance covers your office equipment, inventory, refrigerators, computer equipment, supplies, and all of your business property.
- Example: A storm tears away part of your roof. In addition to the roof damage, wind and rain are allowed inside and cause damage to some of your fixtures and inventory. Commercial property insurance would cover the roof repairs and the inventory and other losses inside your store.
Business Interruption Insurance
- Part of your commercial property insurance.
- Pays for loss of income and certain fixed expenses (e.g., rent, salaries, temporary relocation expenses, etc.) if your business must close due to a covered loss.
- Example: You’d probably have to close to repair your storm-damaged roof and replace fixtures and inventory. Business interruption insurance provides temporary income replacement after a covered loss. It helps you pay for rent, employee salaries, and utility bills while your revenue is limited, so you don’t have to close your doors for good.
Equipment Breakdown Coverage
- Pays for repairing or replacing damaged or broken essential equipment, such as wine refrigerators and point-of-sale systems that are critical to the continued operation of your wine shop. Also provides income replacement if your revenue stream is interrupted while the equipment is unusable.
- Example: Certain wines must be kept at very precise temperatures in order to maintain their taste and freshness. If a major wine refrigeration unit malfunctions and all of the wines kept in the unit are ruined, you’d face a significant loss of inventory and revenue. Equipment breakdown coverage would help you recover many of the costs directly related to or as a result of the broken equipment.
Utility Interruption Coverage
- Covers business interruption for the specific circumstances surrounding an interruption in your utility services, such as power or water.
- Example: If a transformer blows and you have no power for several days, this coverage offers income protection as well as reimbursement for destroyed or contaminated beverages and other related losses.
Employee Dishonesty and Crime Coverage
- Protects your store if an employee or a group of employees engages in theft, forgery, or fraud that damages your business.
- Also offers coverage in cases of shoplifting and vandalism.
- Example: If an employee steals cash from your cash register or steals a rare bottle of wine, your employee dishonesty coverage would respond and cover the related expenses according to the policy.
- Example: If your wine store were targeted by thieves, your crime coverage would help you recover the related losses according to the specifics of your policy.
Why Do You Need Liability Insurance for Your Packaged Wine Shop?
Liability insurance protects your business when you are considered to be negligent or blamed for causing harm to an individual or another business. This can happen in a variety of ways at your wine shop.
- Commercial general liability (CGL) insurance provides broad protection for third-party bodily injury and property damage claims.
- Also provides coverage for product liability, advertising liability, slander, and libel claims against your packaged wine shop.
- Example: If a large bottle falls off a high shelf and injures a customer, your general liability policy pays for direct costs (medical bills, etc.) as well as attorney fees, court costs, settlements, and judgments if you are sued.
- Example: In the course of advertising your wine shop in the local newspaper, you cause a financial “injury” to a competitor by copying their advertising ideas, or infringing on a copyright or slogan. Your CGL policy would protect you if you were sued for damages as a result.
Liquor Liability Insurance
Any establishment that sells, serves, or assists in the purchase or use of alcohol is exposed to liability claims that could result from a patron drinking too much and injuring someone or causing property damage. This includes restaurants, bars, caterers, breweries and wineries, grocery stores, and of course liquor stores—including packaged wine stores.
Liquor liability insurance covers your responsibilities associated with intoxicated guests who go on to harm others. It pays for bodily injury or property damage expenses caused by an intoxicated person who was served liquor by the policyholder. It also pays for your legal costs as well as any financial settlements for the injured parties.
So if you sell wine to a customer who then kills someone while driving drunk on their way home from your store, you could be named in a lawsuit, and your liquor liability policy would respond.
Liquor liability claims are excluded from your general liability policy, so liquor liability insurance covers the gap. What’s more, your state or financial institution may require you to purchase liquor liability coverage. The coverage may be added as an endorsement to your CGL policy, or you can purchase a stand-alone policy. The coverage limits and specifications will vary based on your preferences, your state's requirements, your annual sales, and several other factors.
Other Packaged Wine Shop Insurance Policies to Consider
Aside from major property and liability risks, wine shop owners are likely to need several other insurance policies to protect them from financial harm and unexpected events. Talk to your independent insurance agent about your need for the following.
- Commercial auto insurance protects any vehicles owned by your wine shop. In addition, if employees drive personal vehicles for business use you need hired and non-owned auto liability insurance.
- Workers’ compensation insurance is required for any business that has employees. It protects your workers—including store managers, stock persons, and cashiers—from the costs of work-related injuries and illnesses. This coverage pays for medical bills and lost wages for employees who sustain cuts, slip-and-fall injuries, repetitive motion injuries, or any other injuries or illnesses related to their work.
- Cyber liability insurance protects your wine shop if you are the victim of a cyber breach. If your computer network or website is hacked and confidential customer or vendor information is exposed, the damage to your reputation and bottom line can be insurmountable. This is especially important for online wine stores, but any store that transmits or stores electronic data is likely to need some form of cyber liability protection.
- Employment practices liability coverage protects you if a current or former employee sues you for discriminatory employment practices.
- Contamination and spoilage coverage pays for certain losses if food or beverage products are spoiled or contaminated due to refrigeration breakdown, utility interruption, or some other type of foreign substance contamination. If your local board of health or another agency forces you to close because of food or beverage contamination, your contamination and spoilage insurance may cover you for lost income during the shutdown period, as well as costs related to cleaning contaminated equipment, and disposing of and replacing spoiled or contaminated wine.
How Much Does Packaged Wine Shop Insurance Cost?
Your business insurance costs will depend on the policies you choose, the unique risks your business faces, the value of your inventory and equipment, and other factors like your location, number of employees, and the size of your establishment.
Your liquor liability insurance has a significant impact on your overall business insurance costs. Because of varying liquor liability laws, your business is more likely to be hit with a liquor liability claim in some states than in others. Your independent insurance agent can help you understand the laws in your state, and make sure that your liquor liability insurance offers appropriate protection.
An independent agent can work with you one-on-one to determine the types and amounts of coverage you need. Your agent can get quotes from multiple insurance companies so you can evaluate the cost and coverage options and make the best choice.
Benefits of an Independent Insurance Agent
Independent insurance agents simplify the search process for finding the right wine shop insurance. They’ll walk you through some handpicked policy options and explain the details.
Most importantly, they’ll be there for you when claim time comes. They know the ins and outs of the process and will make sure your claim is handled appropriately.
The Lowdown on Online Quotes
Online quotes can be tempting. They are fast and easy to get—but are they accurate? And are you getting quotes for the right coverage? For business owners, choosing speed over accuracy can cost you.
Online quotes can’t and don’t see the whole picture. They can leave out important coverage that will leave you devastated if something unexpected happens. And they can leave out cost-saving opportunities that an agent can help you take advantage of.
Instead of getting an online quote, find an independent insurance agent now, and get one-on-one consultation and affordable options for the best coverage for your unique needs.
TrustedChoice.com Article | Reviewed by Paul Martin
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