Whisky insurance???

I suppose if something's valuable, no matter what it is, someone will want to insure it . . . but insuring whisky sounds to me like a loss waiting to happen.

With prices of rare whisky soaring into the six and seven digits, ensuring that precious spirit is protected is not only recommended but essential, says Ron Fiamma, head of global collections at American International Group Inc.’s private client group. The insurance giant has seen such an uptick in whisky collecting that it has expanded its coverage of specialty collections to include those owners whose tastes run to a 1926 Macallan.

“Whisky collectors now number in the many hundreds, closing in on 1,000 individual collectors of all stripes and values,” says Fiamma of AIG customers highlighting whisky within their insured collection. “When auction houses are holding two or three whisky auctions a year, with some whisky going for a million or half a million dollars, clearly it warranted attention.”

To wit, on Nov. 29 a bottle of The Macallan that spent six decades in an ex-sherry oak cask sold for a record price of 1.2 million pounds ($1.5 million) at Christie’s London. A rare 60-year-old Macallan whisky fetched HK$7.96 million ($1.01 million) at Bonhams Hong Kong in May. A second bottle from the same vintage was sold later the same day at the same auction for $1.1 million. Both sold for more than twice their high estimate.

Rare whisky has appreciated 140 percent in the last five years, according to the Vintage 50 Index compiled by Rare Whisky 101. AIG has seen an almost tenfold increase in new submissions for whiskey insurance year over year.

There's more at the link.

First off, what risks does the insurance cover?  We've all seen photographs from earthquake zones of bottles of wine and spirits, broken on the floors of shops when they fell off the shelves.  It happened in Alaska just a week or two ago.  This image was posted on social media afterwards.  (I don't know where it originated, so I can't credit the source, but I'll gladly do so if someone will point it out.)

Will whisky insurance cover that?  The insurer might insist on the insured wrapping each bottle in an individually tailored sheepskin, fuzzy side in, and then suspending the lot from an earthquake-proof davit or crane in a drop-proof container.

As for the obvious claims . . . "Hello?  I want to claim against my whisky insurance.  Someone broke into my cellar last Saturday night and drank three million-dollar bottles of it.  What's that?  Why, yes, we were having a party at the time, but what's that got to do with it?"

Personally, given the choice between paying a million dollars for a bottle of whisky, or retiring on the proceeds of the money, I know what I'm going to pick . . .

Peter