Risk & Business Magazine Capri Insurance Fall 2016 | Page 28

INSURANCE AND WINE

BY: ROBERT FIUME,
PARTNER, CAPRI INSURANCE

The Essential Crossroad Between
Insurance And The Wine Industry
Risk Management

R

isk management is a key factor
in reducing your exposure to
injury or loss. By taking steps
to identify, analyze, treat, and
monitor risk exposure, you are
taking the first steps toward loss prevention.
For wineries, risk management is an
essential, but often overlooked, exercise.
When it comes to insurance options
specifically for wineries, there aren’t many
available to choose from and very few
of them focus on risk management. For
over sixteen years, I have been developing
specific insurance programs that address
the needs of agricultural-related industries.
As a grape grower and winery owner, I
am able to use my unique perspective and
insights into how to bridge the two worlds
of insurance and agriculture.
Wineries are inherently different from
other businesses. Due to the length of
time involved in the wine-making process,
the value of your stock is variable and
dependent upon how far along you are
in the process. How do you value your
stock during the process of growing the
grapes, winemaking, cellaring, and then
producing the final bottled product? When
considering these factors, ask yourself the
following questions:

•

Does my valuation take into
account the stage of production that
immediately preceded the loss?

•

How long will my business
interruption last?

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•

Does it cover the wages of key
employees?

•

Does it cover the wages of staff deemed
to be “ordinary payroll”?

These are just some of the questions
addressed by the unique program that we
have developed for wineries.
Many agricultural businesses need to
address the fact that they are, in the
majority of cases, family owned and family
operated. Is the family home protected in
the event of a loss? How do you best protect
your personal assets and your business
assets wit hout one impacting the other?
Many agricultural operations grow until
they reach a point where they are no longer
simply commodity farming. Operations
often expand into the realm of agritourism,
where the public is invited onto the
premises for a “farming experience.” How
do you deal with this increased liability
exposure? Our process is designed to
better protect you with a self-inspection
form, a list of operational risk management
procedures, and coverage that addresses all
aspects of your operations.
We also apply these same risk management
principles and procedures to all agricultural
risks such as fairs, rodeos, and trade
associations. Often these risks rely heavily
on volunteers, including the actions of
volunteer board members. Volunteering
and getting involved in trade association
boards is both noble and essential for the

betterment of those associations; however,
you need to make sure you are protected
in your capacity as a board member. As
a director or officer, you can be held
personally responsible for the decisions
of the board and are required to act with
a duty of loyalty, a duty of care, and a duty
of obedience. With that in mind, we have
designed a Directors and Officers Liability
policy that covers your exposures including
employment practices liability, identity
theft expense, and legal guard telephone
assistance in combination with a number of
other significant coverages.
Finally, when it comes time for choosing
appropriate coverage and coverage limits,
your broker will play an important role
in helping you identify your exposures
and ensuring that your insurance policy
will meet your needs. In conjunction with
carrying the appropriate coverage, risk
management procedures must addressed as
well by business owners and managers as
the best loss is the one that never occurs. +
Robert Fiume, CAIB, is a partner at Capri
Insurance and for the past sixteen years
has been providing specialised commercial
insurance solutions to his clients. A large
part of his focus has been on developing
insurance programs that meets the needs
of his customers by combining sound risk
management policies and procedures with
exceptional coverage.