The restaurateur faces many financial risks the moment they unlock the door and turn on the lights. The passion for cooking can be immediately cut short when something goes wrong and your customer decides to bring an action against you and your company. It’s certainly logical to transfer the risk of owning and managing a restaurant to a third party insurance company with restaurant insurance but what sorts of coverage should you buy?
General Liability – This coverage provides coverage if a third party brings an action for bodily injury or property damage by the restaurateur or their employees.
Product Liability – Provides coverage if the product you serve sickens a customer because of food poisoning or other food-borne illness.
Liquor Liability – When a restaurant serves alcoholic beverages, the server may be responsible for the actions of a patron after leaving the premises. This coverage part of the restaurant insurance helps protect the business in the event an action is brought for financial loss.
Non-owned vehicle liability – Anytime an employee uses their own vehicle for restaurant business (picking up supplies, food deliveries) this coverage will be available if the employee is involved in an accident on restaurant business.
Building Coverage – Building coverage in your restaurant insurance pays if the building is damaged due to a covered peril such as fire, wind or hailstorm. The coverage will pay for repairs or replacement of the building.
Business Personal Property Coverage – Protects your contents and equipment from covered perils such as fire, burglary and windstorm damage.
Equipment Breakdown – Equipment is very important for a restaurateur to run their business. This coverage will pay in the event of equipment failure due to a power surge or mechanical failure of HVAC systems, freezers and coolers.
Spoilage Coverage – Every restaurant has significant investment in food products that can spoil in the event of equipment failure. This coverage will pay to replace food items so that the restaurateur can be back up and running in the event of food spoilage.
Business Interruption/Loss of Income – If the restaurant is forced to close temporarily due to a covered event, this coverage will provide the funds necessary to keep making monthly operating payments until the restaurant can resume operations.
Owning a restaurant can be very rewarding for anyone who is passionate about food and wants to earn a living by cooking and serving food to customers. Knowing the risks of being open for business and mitigating those risks is by having the appropriate restaurant insurance can protect the restaurant owner from financial disaster.