The sustainability, eat local, and grow organic movements have all come together in the drive to produce craft beer from “farm to keg.” While popular with consumers, Beall Brewery Insurance points out that the farm to keg movement requires careful consideration of risk exposures and insurance coverages to protect the entire business—from the field to the taproom.
Many craft breweries have longstanding relationships with local farmers, and source local produce to include in their unique brews. The farm-to-keg movement takes this effort one step further. Bewers plant and harvest their own crops to include in their own brews—including hops and barley.
The Benefits of Farm to Keg
Proponents are quick to point out that the farm to keg movement eliminates brewers’ reliance on outside vendors. If they grow ingredients themselves, they are no longer at the mercy of growers’ potentially escalating prices—or high shipping costs.
Those who celebrate the farm to keg movement also claim that farmer-brewers won’t have to worry about ingredient shortages. And, obviously, the brewery controls the entire beer production process from start to finish.
Laws in several states have made it possible for farm-based breweries to establish themselves. (Nearly four dozen farm breweries launched in 2015 in New York alone!)
Though the trend is growing in popularity, it is also one way for craft breweries to distinguish themselves from competitors in an increasingly crowded marketplace.
Risk Exposures of Farm to Keg
This movement is not without its challenges, however.
Perhaps most importantly, farming and brewing are two very different—and consuming—fields of endeavor. It may be challenging to successfully manage all the work necessary to grow crops and brew beer.
Farming is a risk-filled industry that requires unique protections. Consult your insurance agent to find out about farm insurance and crop insurance.
Farming is also an expensive industry to succeed in! If you are considering purchase of farm property, consult your insurance agent. Your insurance premiums for the property itself could be much steeper than you anticipate if, for instance, there are not enough—or not close enough—water sources.
After all, if you are solely responsible for production of your brewery’s hops, what will happen to your beer production schedule if your crop fails? Crop insurance could help protect you against this potential problem—but you may also need to have a relationship with a hops producer who could help you fill the gap.
You will also want to check with your brewery insurance agent about your spoilage and contamination coverage. Do any changes need to made to that coverage if you are producing the ingredients themselves, as well as the resulting beer?
For more than 25 years, Beall Financial and Insurance Services, Inc., has been helping corporations and individuals protect their most important assets. The agency’s client base covers a spectrum of niche businesses, such as craft breweries, that require specialized insurance packages and knowledge. With California offices in Redlands and Newport Beach, Beall Financial and Insurance Services serves clients nationwide.
