The Vintage Can Be Gone Before the Building Is

A wildfire can impact the vintage without damaging the barrel room. Even if the tasting room and tank farm are unharmed, smoke exposure, power outages during crush, or evacuation orders can disrupt production and affect the vintage while fruit is still in bins.

Many owners are unaware that standard commercial property policies primarily cover the building, not all winery assets. For producers, assets include wine in tanks, caves, and on the vine. Falcon West is an independent brokerage that helps clients design insurance programs tailored to actual winery operations, partnering with AM Best A-rated carriers. Our goal is to align your coverage with your business needs, though not every loss can be guaranteed.

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The tasting room may survive, but the vintage might not.

When a barn burns, the damage is clear: charred tanks, collapsed roofs, and destroyed barrel rooms. These losses are difficult and must be documented, valued, and photographed. Most property policies are designed to address these types of losses.

Less visible losses often occur during harvest. Evacuation orders can interrupt production, power shutoffs may halt cooling systems, and smoke exposure may not show immediate effects. Grapes may appear unaffected, but lab results can later reveal compromised wine quality. The building’s condition does not always reflect the status of the vintage. For example, the Glass Fire began on September 27 and was contained on October 20, burning 67,484 acres across Napa and Sonoma and destroying 1,555 structures. A late-September fire is both a production and property event. The Pickett Fire, which started near Calistoga on August 21, 2025, burned about 6,800 acres and destroyed five structures, according to Cal Fire, but still exposed fruit to smoke during harvest. In July 2026, the Hardin Fire in Pope Valley covered 79 acres, with no structures threatened and no evacuation orders. Not every fire becomes a Glass Fire, but each incident highlights that fire season and harvest often overlap.

If your insurance program only covers the building, it does not provide adequate protection for a winery.

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On the vine or already picked.

A key coverage question often overlooked is whether, at the time of smoke, heat, or fire, the grapes were still on the vine or had already been picked, processed, or stored as wine.

Those are different products. Fruit on the vine is often a crop-insurance conversation, frequently through a federal crop program rather than a standard commercial property form. Many commercial property policies exclude growing crops. Once the fruit is picked, it is more often treated as inventory or stock: in bins, tanks, barrels, bottles, warehouses, or on trucks. Some wineries historically used a stock-throughput policy to follow that product from harvest until the winery released custody and control. Others rely on the property form, inland marine for transit, and a patchwork of location-based limits.

Not all insurance policies define coverage the same way. Review your policies with your broker before harvest and clarify which policy applies in each scenario. If you do not document the answers, they are not part of your program.

Policies often distinguish between finished or in-process wine and fruit still on the vine. This is a coverage issue, not a valuation issue. Request written documentation of these distinctions from your broker.

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Smoke taint does not require a burned building.

Smoke taint is a real winemaking problem, not a press nickname. When grapes are exposed to smoke, they can absorb free volatile phenols from burning wood. Those compounds can bind to grape sugars and form glycosides that do not smell like smoke until later. During fermentation, and sometimes in barrel or bottle, the glycosides can break apart and release the phenols, which is when a wine can show as smoky, ashy, burnt, or medicinal. The Australian Wine Research Institute has described that pathway in plain terms, and growers already sample for it. From an insurance perspective, scientific records such as lab results, harvest dates, block maps, and documentation of smoke exposure are essential for substantiating a loss. While these records do not guarantee coverage, they inform both winemaking and claims decisions. Discuss these considerations with your broker before harvest, not after production is complete.

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The file you already keep is what gets a claim moving.

Wineries maintain operational records such as weigh tags, tank reports, work orders, blending history, bottling logs, and sales by channel. Accurate records of current wine locations and facility photographs, as required by underwriters, are also important.

These records are essential for processing a claim. Adjusters require clear documentation to match the policy to the loss. Keep records current, organized, and securely stored off-site or in the cloud.

If you use custom crush, third-party storage, or store wine in multiple locations, ensure your policy accurately reflects all locations. Update coverage limits regularly. Proper documentation and policy alignment help prevent delays in claims processing.

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Library bottles, bulk lots, and wine you haven't sold yet.

Have three key discussions before fire season, not during a claim.

Library wine differs from current case goods. Some bottles are irreplaceable or serve as marketing assets. Confirm whether library wine is scheduled, whether coverage limits are adequate, and how the policy classifies it. A single rare bottle may exceed the value of a pallet of current release, which a blanket limit may not cover. If you sell a mildly affected lot as bulk or at a discount, this is both a winemaking and commercial decision. Review your policy to understand how salvage is handled, who must approve sales, and whether selling without carrier approval affects coverage. Address these questions before a loss occurs.

It is common to produce more wine than is sold in a year, resulting in inventory buildup. Production and sales figures differ, and setting limits based on past shipments may leave current inventory underinsured. Inform your broker of actual inventory levels at all locations and update this information as needed.

These are not formulas, but essential questions your broker should address to ensure your policy meets your needs.

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London left the inventory market in 2019.

For about two decades, many California wineries placed inventory stock-throughput coverage in the London cargo market at Lloyd's of London. In 2019, after a large 2017 loss year and a review of unprofitable lines, Lloyd's stopped underwriting that coverage for California wine: grapes on the vine, wine in production, and finished product until the winery released custody and control.

The domestic market absorbed the risk, resulting in tighter capacity and higher deductibles. Some owners chose to retain more risk or invest in mitigation measures such as generators, defensible space, and relocating finished goods during fire season. The Glass Fire did not alter these market conditions.

Securing coverage remains challenging in California, even as other commercial lines improve. Underwriters continue to evaluate wildfire mitigation measures such as defensible space, construction, and protection systems. Your broker's ability to place coverage is critical. In a market with reduced capacity, both access and the quality of your submission determine program availability at renewal.

We are a commercial brokerage based in California, providing coverage for businesses with risks including wineries, wine inventory, and agriculture-related operations, as well as property, general liability, inland marine, business income, and related coverages. Our approach is consistent with any serious commercial account: we review forms together, align coverage with operations, and present submissions to markets that will write the risk.

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Consult a broker with experience placing this type of coverage.

Before the next harvest, meet with your broker to review your insurance program in detail.

• Which form responds if smoke hits fruit still on the vine, and which form responds once it is picked?
• Are growing crops excluded on the property policy, and if so, is there a crop program in force?
• How are in-process wine, finished goods, and library wine each treated, and are the limits current?
• Where is the wine this month, including custom crush and off-site storage, and does every location appear on the policy?
• What is the wildfire deductible, and can you actually fund it during the same year you lost a vintage?
• Is business income and extra expense written for an evacuation during crush, or only for a building that burns?
• What does the carrier want to see on mitigation, and are the photos and the occupancy details current?
• If a claim is denied or delayed, who reads the denial against the contract?

If the response is, "the package covers you," request further clarification. Packages assemble programs but do not guarantee coverage in every scenario. A brief discussion can reveal whether your program has been properly reviewed. If your current coverage is sufficient, we will confirm it. If not, we will outline available options and trade-offs before the next high-risk period. Working with an independent broker does not increase your costs because commissions are included in the premium.