How breweries can manage outdoor risks with increased storms and growing crowds

The past few years have seen dramatic weather fluctuations across the U.S. Hurricanes have continued to wreak havoc up and down the coast through Texas and wildfires are now considered to be a year-round, rather than seasonal threat. At the same time, wind and hail losses are on the rise for many businesses. As breweries enjoy the summer, hopefully welcoming high customer traffic both inside and outside, it is important to consider how weather and other outdoor risks, like pets on the premises, special events and more can impact operations, as well as how business owners can take steps to mitigate that risk. 

Storm Threats and Mitigation Tips

Most notably, convective storms have been problematic for craft breweries nationwide. Typically, the worst convective storms we have seen have hit Oklahoma, Northern Texas and Kansas, however we are now seeing weather events like these threaten breweries in other regions as well. 

In a convective storm, heavy hail can cause roof damage, particularly to properties with flat roofs. One bad hailstorm can lead to an entire roof replacement. Unfortunately, in many cases, cosmetic damage to a roof is not covered by insurance. In such incidents, where the roof, though damaged in appearance, can still serve its purpose, brewery owners would be forced to reach into their own pockets to rebuild their roof and possibly shut down business operations during that entire time. 

Further, one powerful storm can damage the building and contents of a brewery, as well as potentially put the operation out of business for months at a time. Storms can also damage a brewery’s mechanical operations, such as the heating, ventilation and air conditioning system (HVAC) and power supply, or its fleet – not to mention the threat to employee and customer safety. 

Consider the following best practices for preparing for potential convective storms:

• To avoid property damage, brewery owners should regularly inspect and maintain roofs and exterior structures. Consider installing impact-resistant windows and doors as well. Before a storm strikes, secure outdoor equipment and storage and use enclosures around mechanical structures so hail does not directly strike the equipment. Placing blankets or pads on car windshields can also reduce the chance of auto damage.
• Keep raw materials and finished products in elevated, secure areas. These materials and inventory should be stored in climate-controlled storage solutions as well.
• Install surge protectors to protect critical equipment. Consider keeping an emergency supply of water and essential utilities on hand in case a storm traps staff members at the location for extended periods of time.
• Maintain a buffer stock of essential supplies in case brewery owners and operators cannot access their usual supply partners. Take time to diversify transportation routes and methods in case roads are out of service. Communicate proactively with suppliers and customers so they are aware of any potential delays.
• We always recommend breweries have a business continuity plan in place for any disaster. We also recommend establishing relationships with alternative suppliers and distributors and implementing backup power solutions such as generators.

If brewery owners or operators know a storm is on the horizon, having a risk mitigation procedure in place is critical. This plan should outline everyone’s responsibilities during a storm. The brewery owner could also designate a safety committee responsible for immediate response during a storm. This would include these risk mitigation protocols so the brewery can ensure machinery, equipment and staff and customers are safe.

Other Outdoor Risks to Consider

In addition to storm related risks, there are additional outdoor risks breweries should consider this summer and fall. In good weather, customers love bringing their pets along with them to breweries, but this can create a few safety threats. At a pet-friendly brewery, owners and operators should have clear safety policies, such as requiring rabies tags and leashes, and regular cleaning schedules to ensure pet hair and waste are not lying around the property.

We have also seen a rise in claims around summer events hosted at breweries. For example, a Midwestern craft brewery expanded their summer operations to include a lively outdoor space for customers. They set up a seating area with picnic tables, umbrellas and a small stage for live music. During a live music event, a summer storm with high winds and heavy rain ravaged the venue. The wind caused umbrellas on property to fly and strike several customers. One individual sustained a broken arm, while others experienced minor cuts and bruises. The injured patrons filed a claim against a brewery, which led to a $250,000 payout. 

The brewery’s outdoor furniture and stage equipment were also heavily damaged by the storm. The rainwater warped the wood and led to a malfunction with the electronics. The brewery filed a claim to cover the cost, which was $68,000.

Before any storm, brewery owners and operators should be sure to secure umbrellas or tents tightly and other outdoor objects that could become hazards to patrons, employees or the property. 

In a separate incident, a craft brewery hosted an outdoor beer festival during a particularly hot weekend. Conditions were so hot that several attendees suffered from heat exhaustion and heat stroke. Two patrons were hospitalized due to severe dehydration and heat stroke and the subsequent claim for medical expenses led to a $175,000 payout. 

In advance of events, brewery owners and operators should check weather forecasts and ensure they have comprehensive cooling measures or water supplies on hand in the event of extreme heat, as well as emergency medical assistance at the ready. 

Moving Forward

While a brewery owner cannot avoid risk exposures like these entirely, they can take steps to mitigate their risk. A specialty insurer who knows the brewery space can assess the property to help ensure the business is providing a safe environment for customers and staff and ensure the brewery has the right insurance coverage and risk mitigation practices in place. 

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Paul Martinez is program manager and insurance brewmaster for Brewery PAK Insurance Program. Martinez has 20+ years of commercial insurance experience and 10 years of experience underwriting breweries. He can be reached at 888-386-5701 or  [email protected].