November 11, 2009 Protect Your Vineyard Investment

Buying Or Starting A Vineyard Costs Big Bucks

Undoubtedly, if you are thinking of buying a vineyard or creating one from the ground up, the challenges are many and a vineyard investment is a huge one indeed. Of course, that shouldn’t deter you. But, a realistic estimate of vineyard costs should be the crux of your vino-venture.

The Real Investment Cost & Risk Of Starting A Vineyard

In our last post, we focused on a University of Arkansas report discussing considerations for starting a vineyard. That report fell far short of incorporating all of the costs, most notably vineyard insurance.

However, even protecting your vineyard assets with insurance is not a cut-and-dried prospect. Did you know that the time between starting or buying a vineyard and the time it starts producing certain amounts of viable grapes, your assets are not eligible for coverage under the federally subsidized crop insurance program?

The investment required to create a vineyard is hefty, so the protection provided to your investment should be thorough.

In other words, say you start a vineyard and purchase all the land, labor and equipment needed to start growing grapes. Until your vines start producing a certain tonnage of grapes, all of those assets – all of that vineyard investment – is left uninsured against potential destruction.

That’s Three To Five Years Of Vineyard Costs Left Exposed To Risk

On average, it takes three to five years for a start-up vineyard to produce viable grapes. During that time, all of the infrastructure and the costs associated with installing that infrastructure are waiting to be destroyed. It’s a bit of a grim statement, but the stakes are that high.

Take a look at Orchard Valley Supply, one of the top suppliers of things like trellises; stakes; harvest supplies; irrigation equipment; and too many other products to list. A healthy vineyard investment would consist of thousands of dollars of equipment from a place like Orchard Valley Supply, in addition to land purchase (if applicable); labor and equipment to get the land in growing condition; irrigation; quality rootstock; and more.

We’ll cover the costs of starting a vineyard in more depth in our next post.

The point is that all of this time and capital invested in creating your vineyard will not be protected through crop insurance programs until your vines start producing mass amounts of grapes.

And that’s where Live Asset Insurance can help you avoid the risk of potential destruction of your vineyard investment. We are the only firm to cover that vital vineyard infrastructure until the federal crop insurance kicks in. We effectively protect your vines and their life support system from in the event that they are destroyed or damaged by natural occurrences – like wild fires, for example.

Live Asset Insurance Coverage Protects Your Vineyard Investment

The first three to five years of the life of your vineyard is crucial for future success. It is truly the infancy of your venture. Leaving the future of such a huge investment to the whims of Mother Nature doesn’t make financial sense. That timeframe of risky exposure for your vineyard is unnecessary when Live Asset can provide protection during those vulnerable years.