A Tragedy in the Making

If the threat of fire isn’t enough to put you off winemaking, how about the threat of fire and no insurance?

Esther Mobley reports that, as wildfire season looms, some California wineries have been unable to purchase fire insurance.

“My vineyard is surrounded by thousands of acres of trees. It’s set to go. It’s going to go in my lifetime, probably,” said Andy Peay, co-owner of Peay Vineyards in the Sonoma County community of Annapolis. Peay said he was dropped entirely from his fire insurance plan this year and has been unable to find another carrier willing to insure his property.

“People say, ‘What’s your plan B?’” Peay said. “I don’t have a plan B.”

For those fortunate enough to have insurance, they face premium increases of over 300%.

The destructive fire seasons in the recent past, especially 2017 and 2020, have hit the insurance industry hard.

“…some carriers that cover wineries have simply withdrawn from the market…Others may be limiting the number of wineries they cover to mitigate their risk, according to Janet Ruiz, a spokesperson for the Insurance Information Institute, which represents the insurance industry. She cited the example of an insurance carrier that went out of business after the 2018 Camp Fire because it covered many properties in one region.”

Without insurance, mortgage holders may be in violation of their contract and, if they wanted to sell, buyers will be reluctant to purchase uninsured properties.

I don’t know what the solution is but California, Washington State, and Oregon need to find one. The status quo is unsustainable; this industry could be decimated by another bad fire season.