On average, restaurant structure fires cause more costly damages than residential structure fires.
Owning and operating a restaurant is a lot of work. However, it also provides a great deal of income potential for the inspiring entrepreneur. If you are a restaurant owner, you have devoted a lot of time and money toward your business; make sure that it remains profitable by protecting it with a proper restaurant insurance policy.
What Kinds of Insurance Do I Need As A Restaurant Owner?
As an owner of a restaurant, you may be required to carry several different types of insurance coverage. Some insurance is required by the law and some may be required by your financial institution if you have taken out a large business loan or a mortgage on the building in which your restaurant is housed. If you rent the building, you may be required to carry business insurance as a condition of your lease.
Some necessary insurance types include:
- Worker’s Compensation Insurance
- Unemployment Insurance
- Life Insurance: This is sometimes required by lenders if you have taken out a significant business loan to finance your commercial initiative. This way, the lender can be certain that your estate will be properly settled and your business loan will be paid if something should happen to you.
- Commercial Vehicle Insurance: Necessary if your restaurant offers delivery service or catering using company-owned vehicles, and/or your employees drive those vehicles in the course of work.
- Restaurant Insurance: This is a business insurance policy specifically designed for owners of restaurants. It provides general liability and property damage coverage as well as coverage for many types of hazards unique to restaurant owners.
Restaurant owners have a number of liability risks. Restaurant insurance costs far less than a serious lawsuit might, so it is a good investment. Some examples of the of liability coverage options available are:
- General Liability: This includes operations and premise liability
- Product Liability: As a restaurant owner, your product is the food you serve to customers. If customers become sickened either by food poisoning or other food-borne illnesses, and it can be proven that this occurred because of food served in your restaurant, you will more than likely be sued for medical costs and punitive damages.
- Liquor Liability: If alcoholic beverages are sold and your restaurant allows a customer to become intoxicated, your business may be held liable for the drunken patron’s ensuing actions, including acts of violence and/or property destruction.
- Hired and Non-owned Vehicles Liability: If your restaurant offers food delivery service but your employees use their own vehicles, this will provide you with coverage if they are involved in an accident while making a delivery for you.
Your insurance will also provide you with coverage for damages against your property. This can include damages caused by fire, crime, electrical problems and certain weather events. Some property coverage options include:
- Building coverage: Only if you own the building itself, this provides compensation for damages to the structure of your building.
- Contents coverage: Coverage for your property inside the building including furniture, light fixtures, artwork, flooring, computers and kitchen equipment.
- Equipment breakdown coverage: Equipment such as freezers, stoves, and dishwashers are vital when operating a restaurant. If a mechanical failure results in equipment breakdown, your business will endure expensive repairs resulting in lost income. This coverage will provide you with the compensation for your losses.
- Food contamination coverage: If a power outage, mechanical failure or other covered event results in ruined food that must be thrown away, this coverage will provide for the cost of spoiled food.
Talk to one of our commercial insurance experts and start developing a plan to keep you and the restaurant you work so hard for protected.
Call us with any questions about Insurance or schedule an appointment. Let LF Insurance help you secure your future with the right Insurance policy. 303.422.2018