Does Homeowners Insurance Cover Your Wine Collection?
When do you need coverage for wine? What are the options?
You are carrying a few wine bottles up from your wine cellar for a special celebration, and they slip out of your hands and break. Will your home insurance cover you? What if a power failure causes your temperature control system to fail and some of your wine collection goes bad?
Most home policies have exclusions that can prevent you from getting paid in a claim for situations that are listed among them. When you buy a home with a wine room or cellar, or you have amassed an investment-grade wine collection, it is important to look into whether your home insurance will provide adequate coverage.
Most standard home insurance policies have limitations and exclusions or policy conditions that may not take into account special coverage needs for collections like wines and spirits or items of high value. The good news is that some insurance companies can offer endorsements on your home insurance policy to insure valuable items like wine and related equipment. Here’s what you need to know about wine insurance coverage options, with tips on how to decide if wine insurance is a good idea for you.
When Is Wine Insurance a Good Idea?
These days, having a selection of wines at home is not uncommon. Whether you stock up for entertaining and regular consumption, or you are an amateur (or serious) collector, any time you start to have a significant amount of wine at home, you should consider wine insurance.
What Kind of Insurance Do You Need?
If you do not purchase specific insurance for your wine, you may have some coverage under the personal contents coverage of a standard homeowners, renters, or condo insurance policy. However, that coverage may be limited. Ask your insurance company what the basis of claims settlement is for wines and spirits to understand whether you need extra coverage or not.
Standard home insurance policies have different coverage than what’s offered by high-value home insurance companies; A high-value home insurer may have special options that other insurers do not offer for items like wine, spirits, and collections. It is worth doing a bit of research before you settle on an insurance company for your home when you have a wine collection.
Insuring Wine: Review the Options
There are two standard forms of wine insurance.
Blanket Wine Coverage
Blanket coverage allows you to purchase general coverage for unspecified items based on value. For example, if you don’t have an itemized list of your wine, or you use your wine for regular consumption and have rotating bottles, then choosing a blanket coverage may be a good option. In general, you would decide on an amount of overall value to insure. The advantage of blanket coverage is not having to update an itemized list every time you drink, change, or acquire a new bottle of wine. Many insurance companies offering blanket wine coverage may limit the value per bottle, for example, at $1,000 each. You may still choose a larger amount of coverage, such as $25,000 of blanket wine coverage but with a specified limitation per bottle.
If you tend to have bottles of wine at higher values than the limitation, the second option for coverage below may be a better fit for your needs.
Scheduled Wine Coverage
Scheduling your wine involves having a wine inventory and providing this to the insurance company. A wine inventory will be similar to your home contents inventory, except it will specify the details of each insured bottle of wine, along with a value per bottle. This is useful for more serious collectors who have highly valued wines or maintain wine inventory lists.
It is possible to use a combination of blanket and scheduling types of coverage for insuring your wine collection.
What Are Coverage Options for Wine?
Besides the type of coverage you choose, whether scheduled or blanket, the coverage for wine is available at different levels. For example, very basic wine coverage may cover specified perils like fire and theft. However, it may not cover breakage. If you are a more serious wine collector, you may decide on coverage for losses due to wine-climate change or even systems failure. You can elect to purchase wine insurance as a standalone policy, or as an add-on to your home policy (when available).
Examples of Coverage Features
- Fire damage, flood, or earthquake
- Loss to labels (staining, tearing, or other damage that can reduce the value of the wine)
- Vibration, or light coverage
- Wine accessory coverage, such as protection for climate control systems, preservation systems, inventory software, racks, and other wine-room or cellar tools
- Location-based coverage, or worldwide coverage
- Wine in transit or in storage
How Much Does Wine Insurance Cost?
The cost of coverage depends on the features: the more you have, the more expensive the coverage will be.
If you make a claim, wine insurance will offer you better compensation than standard content coverage because it has a broader coverage and may have no deductible.
Wine insurance may cost less than you expect. In general, an insurance company will charge a rate per $1,000 of coverage. You may only be paying a few cents per hundred dollars of coverage for a basic blanket policy. Each company is different.
Advantages of Wine Insurance
Insuring your wine can give you several advantages, such as:
- No deductible
- Flexibility, if you frequently rotate your wine bottles
- Coverage for newly acquired wines
- Coverage without an appraisal for wine bottles of low to moderate value (for example under $5,000 to $10,000 with some insurers)
- Option for cash settlements at replacement value without replacement, which may be important for bottles that are difficult to replace
- Rising insured replacement value to account for increased market value at the time of loss, in some cases up to 150% of the insured value or replacement cost
When you insure your home, you should let your insurance company know about the features of your home like wine rooms or cellars. This will ensure that your insurance company can establish the proper coverage under the insured value of your dwelling.
Where to Get Wine Insurance
Wine insurance is a specialty type of coverage. You can have it added to your home insurance as a floater, or you may choose to have a standalone policy to cover your collection. Asking your current insurance provider to make a recommendation is a good place to start. Here are some of the companies that offer specialty wine insurance, either directly or through brokers:
- Burns and Wilcox
There are also many other insurers or brokerages that may specialize in wine coverage in your area, so doing an online search for wine insurance near you may point you in the direction of a local provider to compare more options.
The Bottom Line
Insuring your collection with a wine policy or rider can provide more benefits than insuring your wine as part of the contents coverage on your home policy.
If you are trying to decide on coverage, ask what the various options are per $100 (or $1,000) of coverage. You can use a combination of scheduled and blanket coverage to protect your wines. As always, shop around for insurance that can provide coverage for wine before deciding on your home insurance policy. Different companies may provide advantages at lower costs.