Ontario Winery Insurance

Insurance for Wineries in Ontario

Thanks to a one-of-a-kind microclimate ideal for vineyards, southern Ontario is well known for many wineries that produce some of Canada's best whites and reds. Many oenophiles with a passion for wine dream of opening their winery, but of course, the reality of owning and operating a fully functional winery and peripheral businesses is far more than strolls through the vineyard and sunset tastings.

Growing, producing and selling wine comes with unique risk exposures that go beyond what most businesses, and even most agricultural operations, need to worry about—and that's why it's so important to have the right Ontario winery insurance. The experienced brokers at Morison Insurance can begin a winery insurance quote to address your particular needs so you can rest assured you are backed by the financial protection you need to keep your business thriving year after year.

What is Winery Insurance?

Winery insurance is a package of insurance coverages designed to transfer liability risks and commercial property damage from a winery owner to their insurance company. Liability insurance is available in various forms and covers the costs of being sued due to an insured peril.

Property insurance, on the other hand, prevents you, the business owner, from paying out of pocket for the high costs of replacing, repairing, restoring and re-growing your commercial property should it be damaged or destroyed by an insured peril such as a fire or natural disaster. All insurance policies, whether for liability or property, are subject to the coverage limits listed on the policy, so it's essential to ensure that the coverage limits are adequate to get you the insurance compensation you need to get your business back on track if something goes wrong.

What is Available for Winery Insurance Coverage?

No two wineries are precisely alike, so winery insurance isn't a one-size-fits-all solution. Certain types of coverages, such as commercial general liability insurance and commercial property insurance, are always necessary parts of business insurance packages. Still, some specialized coverages may or may not apply to your particular insurance needs depending on how you operate your vineyard and winery and whether you have complementary business operations such as a restaurant or event hosting space. Our insurance experts can make experienced recommendations about the coverage options that are best suited to your business. Here are some of the key winery insurance coverages to know about.

Commercial Property Insurance

Most businesses need commercial property insurance, but it's doubly important for a business such as a winery that relies heavily on a specific set of land, buildings and equipment to produce goods. The most basic form of commercial property insurance primarily protects your buildings and the contents within, including equipment, wine stock, inventory, and more mundane items such as furniture, computers and more. You will likely need additional coverage and endorsements to ensure all your equipment and property have adequate winery insurance coverage. 

If your property is damaged or destroyed by a peril you are insured for on your policy, such as fire, flooding, theft or vandalism, your insurance company will provide you with compensation to deal with the costs of repairing or replacing your equipment and other contents, and restoring or rebuilding the damaged structures.

Orchard and Vineyard Growers Property Endorsement

The trees, vines and unharvested crops can be added with an endorsement to the commercial property coverage in your winery insurance package because it raises the coverage limits for your agricultural fields and typically includes specific coverage limits per plant and the overall vineyard or orchard. If your vineyard or orchard is damaged by an insured peril such as fire, vehicles, or vandalism, your insurance company will supply you with the funds you need to negate the damage.

For example, if a vehicle swerved off the road accidentally and plowed through your vineyard, destroying a large number of vines, your orchard and vineyard endorsement would entitle you to compensation for the destroyed vines, as well as the damaged trellises or stakes, up to the coverage limits listed on your policy.

Business Interruption Insurance

Business interruption insurance is another type of coverage that is particularly important for winery insurance, and it's necessary to have an extended period of coverage beyond the typical time frame. It offers policyholders compensation for loss of income while recovering from the physical damage caused by an insured peril. In the scenario described above, for example, your orchard and vineyard growers' property endorsement would compensate you for the lost plants—but of course, you can't just put new plants in the ground and have them ready to produce right away. It could take a year or more before they can produce grapes, and in the meantime, your business will be losing income because there's not enough raw material to work with.

With business interruption coverage added to your Ontario winery insurance package, you can file a claim to get insurance compensation for that lost income so you can keep your winery moving forward until the vines have grown to the point where they can produce. However, policyholders should note that business interruption insurance typically only applies to a recovery period of a few months, and that's not enough time when it comes to growing vines or other types of plants. Hence, winery insurance requires an additional business interruption endorsement to extend the period that you're eligible to receive compensation for loss of income.

Commercial General Liability Insurance

Commercial general liability insurance is an essential business liability insurance coverage that offers financial protection against expenses such as legal defence costs and settlements in lawsuits where the policyholder has been accused of causing third-party bodily injury or property damage. For example, if a customer or supplier was injured by tripping over a crate that was left out or slipping on an icy driveway, they could bring legal action against you to recover costs such as their medical rehabilitation and lost income during recovery. In that type of situation, you could file a claim on the commercial general liability components of your Ontario winery insurance policy to get the necessary funds to cover the costs of litigation, as well as settlement costs, should you be found liable in court for causing property damage or bodily injury.

Lawsuits related to third-party liability claims can be costly, and realistically speaking, you can't avoid every situation that could lead to being sued for property damage or bodily injury. Even if you weren't responsible, you could still be forced to incur the cost of defending yourself in court, so it's very important to include commercial general liability coverage with your winery insurance.

Product Liability Insurance

Since your winery manufactures and produces products, mainly because those products are ingestible, product liability coverage is a key component of your Ontario winery insurance to prevent you from paying out of pocket for legal costs if someone alleges that your product caused injuries or personal harm. Product liability insurance is protection against the cost of legal defence and settlements should you be sued for problems such as defects in design, manufacturing or marketing and issues such as omitting important information from the label.

An example would be if a vat of wine was contaminated and made it to retail shelves, causing consumers to suffer illness from allergic reactions from the wine contamination and requiring a recall. The affected consumers could bring legal action against you for causing bodily injury. Or, you could be sued or subjected to governmental fines for omitting required information, such as alcohol content, from a bottle label. In those types of scenarios, your product liability coverage would prompt your insurance carrier to provide you with the financial support necessary to deal with the resulting expenses up to your coverage limits.

Product Recall Coverage

No matter how careful you are and how conscientiously you follow every regulation and wine industry best practice, there's always the possibility of a product recall. Whether voluntary or not, significant expenses are involved with recalling a product, from the cost of retrieving the product and rehabilitating or disposing of it to expenses such as government regulatory fines, loss of income and reputation management. The exact costs that are covered by your product recall insurance will depend on your insurance company and how your policy is designed. Still, you can get coverage for all the above expenses, which will prevent you from suffering a significant financial setback in the event of a product recall.

Party Alcohol Liability Insurance

It's a fairly common practice for wineries to host tastings of their products, and many wineries also host private events such as weddings and corporate retreats where alcohol is served. It's no secret that people who have imbibed alcohol are more likely to cause accidental damage or injury, either to themselves or others. Party alcohol liability insurance, which is also called liquor liability coverage, is protection against legal costs should you be sued for a situation in which you served alcoholic beverages to someone who then injured themselves or others or caused property damage, and the alcohol is considered to be a contributing factor.

Additional Winery Insurance Coverage

• Negative Publicity Insurance
• Commercial Vehicle Insurance
• Contents Coverage
• Cyber Liability Insurance
• Farm Equipment Insurance
• Crop Insurance
• Equipment Breakdown Insurance
• Inland Marine Insurance
• Umbrella Liability Coverage

Am I Legally Obligated To Have Winery Insurance In Ontario?

Winery Insurance is not legally obligated in Ontario. However, while winery insurance is not a legal requirement, it is recommended for wineries and vineyards to have insurance coverage to protect their business and assets against potential risks and liabilities. It is important to consult with an insurance professional to understand the specific insurance requirements based on your winery's unique circumstances and any applicable laws or regulations.

How Much Does It Cost For Winery Insurance In Ontario?

It's not easy to narrow down the cost of winery insurance without knowing several vital details about your business because many variables can affect the cost of your insurance premiums. When you apply for winery insurance, the insurance provider completes what's known as a risk assessment. This assessment determines which risks are most likely to occur in your business. Based on the results, they choose which winery insurance quote they can provide. Some of the factors they look at include:

• Business location
• Details of the building, such as age and fire suppression measures
• Items and products you sell
• Insurance claims history
• How many employees do you have
• Annual revenue
• Safety standards
• Business practices—for example, whether you host events
• Previous experience running a winery
• Coverage limits

The best way to learn how much you can expect to pay for winery insurance is to chat with a dedicated Morison Insurance broker and give them some information on your unique business operation. This information will allow them to find the ideal coverage combination at competitive rates and ensure you have the correct winery insurance quote that fits your business.

How Much Liability Coverage is Necessary for Wineries?

The answer to this depends quite a bit on the services you may offer at your particular winery. The typical recommendation for business insurance is a minimum of $2 million in liability coverage, which may suffice if your winery is closed to the public. But if you host tastings, weddings and other events, have a restaurant or bar on your premises, or there are other reasons why members of the general public would visit the property, you will need significantly more liability coverage on your winery insurance. This is because the more opportunities there are for people to be on your commercial property, the greater the risk of a liability issue arising—especially when alcoholic beverages are involved.

Where Can I Get Winery Insurance in Ontario?

If you'd like to know more about Ontario winery insurance or if you’re ready to start a winery insurance quote, call 1-800-463-8074 to speak with the reliable team of brokers at Morison Insurance. From liability coverage to commercial property insurance, we'll find the customized insurance solutions you need to avoid financial losses and setbacks and give you peace of mind that your winery business is protected.

This content is written by our Morison Insurance team. It is provided for general information only. Insurance needs differ from person to person, and this article is therefore not a substitute for professional advice about your individual insurance needs which can be obtained by speaking to one of our brokers.