When does it become YOUR brewing system?

feltnergroup2 Feltner Brew News

Every time we work with a new brewery, a unique question or two inevitably come up. Finding the
answers is always an interesting endeavor—something that teaches us something about our own
industry as well allowing us to further educate our clients.
One recent exchange with a brewery owner brought up the uncertainty of when a brewing system
becomes the property of the brewery owner that ordered it vs. the responsibility of the manufacturer or
the shipping company charged with getting it from point A to point B. Once that’s determined, the
obvious follow up was, when/how does that property need to be insured?
In the case of our client, the equipment manufacturer informed them that as soon as the system left
their production facility, it was no longer the manufacturer’s responsibility. This may vary by
manufacturer, so be sure to learn when the brewing system officially becomes the concern of the
brewery.
So what happens when that system is in transit? Does the contracted transportation company have
insurance for it? If so, how much? Is it enough to cover your system if it were to be irreparably
damaged? The answers might surprise you.
The transit company likely has coverage, however, it is usually on a per pound basis and very often will
not be enough to fully cover a significant loss. The shipper’s coverage will be spelled out in something
called the bill of lading. Whatever isn’t accounted for should lead brewery owners to seek out
additional coverage.
The first thing we did was check the existing general liability policy. Most include a set limit for
“property in transit”. However, the coverage that exists will likely be insufficient to cover the full value
of the brewing system. If your GL carrier has a larger than expected limit built in to your policy, you may
not need any kind of supplemental policy. In the event that you do…
More often than not, this will be in the form of a trip transit policy – a one-time coverage from shipping
point to destination and everywhere in between. This policy will protect your key investment as it
travels to your site. Once it’s in your building, it should be covered under your business and personal
property limit of insurance.
In summary, while it may seem like a given that either the manufacturer or the shipping/transit
company would have your shiny new metal toys properly protected, please do not assume in any way
that this is the case. We encourage you to take the necessary steps to investigate if the manufacturer
genuinely has your property covered, if your current general liability policy might be a capable stand in,
if the shipping company’s coverages would be sufficient if a total loss were to occur and if you might
need additional coverage!