Drum roll, please… Here is the big question we (wine snobs) have asked ourselves… Should I get wine insurance? Alright, maybe not ALL of us. People who buy wine and drink it all within a month don’t need to invest in wine insurance. Conversely, people who buy wine and like to age it for a few years (AKA me), people with a wine cellar that shelters more than a couple hundred bottles, totaling thousands of dollars in value… Then yes, those people might consider wine insurance. Are you one of those people? If so, let’s ponder the benefits of wine insurance together.
Insurance is a very personal matter. Some people are very conservative when it comes to insuring their assets, while others will stick an insurance policy on everything they own and everything they do. And I don’t blame them! It is pretty hard to avoid… Buying a plane ticket? The airline will sell you travel insurance. Buying a brand new refrigerator? The store will sell you a service plan. Renting a car? The rental company will sell you their “full coverage” policy. There’s even pet insurance for your puppy-rescuing deeds. I could go on forever but you get the idea. There’s an insurance policy for pretty much anything in life. Insurance coverage can get expensive but peace of mind is priceless. And that, my friend, leads me to wine insurance.
Do You Really Need To Insure Your Wine?
With the exception of a few insurance policies like home, car, and health, the act of insuring assets remains entirely optional. But when it comes to something as complex and rare as wine, maybe it isn’t as optional as one might think.
For those who store their wine in one of those professional wine storage facilities, insurance is probably included in your deal. But if you store it in your home, you’ll need to look for wine insurance yourself. Small and moderately inexpensive collections could already be insured under your homeowner’s policy, especially if it’s for your own consumption. You would have to check with your home insurance. Larger collections would require a stand-alone policy, often called an “assigned risk” policy, which provides more specific coverage than a home policy. Depending on the overall value of your wine collection, you may be able to insure everything for a set price, but for larger collections, it may make sense to itemize each bottle. Either way, you would need to keep track of your wine cellar content and update its monetary value regularly. I started using Cellar Tracker last year and I love it!
At What Point Should You Consider Wine Insurance?
Once you find out about the overall value of your wine collection, you’ll have to decide if wine insurance is something you want for your own peace of mind. For instance, people with more than a hundred bottles and $5,000 in market value might consider insuring their wine. While this threshold is completely arbitrary, it might help your decision process. Ultimately, the decision about buying wine coverage depends entirely on your personal risk tolerance. Laura Doyle, a policy underwriter for fine art & valuable collections and a Vice-President at Chubb says that if a wine collector tends to be more risk-averse than risk-tolerant, they definitely should chat with an insurance advisor about wine coverage. “Some of our clients choose to insure bottles that are valued at a few hundred dollars,” Doyle says, “while others only insure wines that are valued at more than $1,000 per bottle.”
How Much Does Wine Insurance Cost?
So here is the thing… Wine insurance isn’t as expensive as one might think. But it will vary based on various criteria such as:
- Size and location of the collection
- Exposure to natural disasters
- Collection management, which includes security and fire-detection measures
In other words, I don’t think an insurance company will insure your collection if you keep it on the kitchen counter. But they will gladly do it if you have a temperature-controlled cellar. Stand-alone wine policies cost about 40 – 60 cents for every $100 worth of wine and include a deductible of about 10%. So if your wine collection is worth $10,000, your annual insurance premium will come to around $50. Not too shabby, is it?!
What Does Wine Insurance Cover?
Once again, coverage style might vary slightly, but most wine insurance policies will protect your collection against the following incidents:
- Theft or burglary. That seems like a no-brainer.
- Damage caused by a fire or flood.
- Lost or misplaced bottles. That seems a little hard to believe but OK, I’ll take it.
- Accidental breakage. This could include damage that happens when wine is being transported from one place to another, such as from a winery to your home.
- Damage caused by a mechanical breakdown or power outage affecting a climate-controlled wine storage unit.
- Damage caused by a sewer or drain backup.
- Damage to a bottle’s label caused by a fire, flood, or other natural disaster. I believe that’s part of the coverage because in many cases, the label plays a legitimate part in the value of a rare wine.
- Damage caused by an earthquake or hurricane.
Though the above list is quite extensive, once you open and start to drink a bottle of wine, coverage no longer applies. In other words, no insurance policy will ever cover you against the accidental consumption by your mother-in-law ;)
Where Do I Get Wine Insurance?
Here is a list of wine insurance providers.
- The Horton Group / Ilinois, United States
- Acacia Insurance / Massachusetts, United States
- Insure My Wine / United States
- La Playa / New York, United States
- Ellis Insurance Agency / California, United States
- Chubb Insurance / United States & Canada
- Partners And / United Kingdom
So there you have it! I hope this helps you figure out your specific wine insurance needs. Keep in mind that if anything were to happen to your wine, all you’d be getting from the insurance company is a big check. This will never replace your collection or that 30-year-old bottle you’ve been saving, but it’s a start. If you choose to not get wine insurance, here are a few things to do in order to keep your collection safe and sound…
How Earthquake Proof is Your Wine?
Wine racks aren’t designed to protect your wine collection during an earthquake. In fact, they often fare much worse than a wine fridge or simply leaving your wine packed up in a box. Here are a few tips to keep your wine safe:
- Secure your wine racks to the wall. If your wine racks aren’t custom-built, secure them to the walls of your cellar to avoid any possible tipping and a big ugly mess!
- Place the bottles with the punt facing out, then wrap each row with a 1-inch nylon strap, placing access clips on the front to access the wine. That way, bottles won’t slide out and stay safe in their enclosed space.
- Keep wine stored in wine boxes in your cellar or any enclosed space (like a locker or closet). Obviously not the prettiest of solutions but safer nonetheless. Do not stack more than 2 boxes on top of each other.
- Keep Wine Low: The closer the wine is to the floor, the less likely it is to break when it falls. And the floor of your cellar is made of tiles, lay down a rug directly below the bottles to soften the drop.
- Use Locking Doors: Make sure your wine fridge or wine racks have doors that latch or lock.
When Wine Insurance Pays Off
Do you think La Tour d’Argent had wine insurance? I sure hope they did… La Tour d’Argent is a restaurant, it’s a bar, it’s a roof top, it’s an apartment, and of course… It’s a wine cellar. The historical wine collection consists of 300,000 wine bottles, all ranging from $100 to $50,000. La Tour d’Argent (The Silver Tower) was built in the year 1582, and was named after the stone with which it was originally built. In the 16th century, the restaurant catered toward royalties and aristocrats such as King Henry IV, providing a safe place for the elite to dine. In more recent years, the restaurant was regularly frequented by Queen Elizabeth II, Theodore Roosevelt, Charlie Chaplin, and Bill Clinton. Earlier this year, Some grands crus have recently vanished from the restaurant’s wine cellar. A discrete, not to mention spectacular wine heist has left the authorities without a lead. Unravel the mystery of the wine heist that took place at the famous Parisian restaurant, reminiscent of an Arsène Lupin plot line.