You may think you don’t need restaurant insurance if you and your staff are diligent with safety precautions. While some things, like the 7,000 fires that American restaurants experience each year, are preventable, other things, like the COVID-19 pandemic, are out of your hands. When you equip your business with insurance, you can be prepared to handle anything that comes your way.
A combination of restaurant insurance policies can protect you from being sued if an employee gets injured on the job, or if a customer gets hurt on-premise, for example. Insurance also protects your delivery drivers from accidents on the road, and your revenue from an interruption in business if your equipment stops working.
Restaurant insurance is a no brainer because it covers the costs of emergencies big and small, and protects your business.
Consider these insider tips before buying your restaurant insurance policies.
- Only Buy the Coverage You Need
Not all of the policies outlined above apply to every restaurant owner. For example, if you don’t employ delivery drivers, then you won’t need commercial auto insurance, and if you don’t serve alcohol, you won’t need liquor liability insurance.
Do your research to make sure you’re buying only what you need. Insurance agents can also help you figure out whether or not their policies are applicable to your business.
If a policy is relevant to you, but you’re not sure if you should pay for it, consider whether the annual premium costs are cheaper than covering the costs of whatever might happen out of pocket. More often than not, investing in coverage makes more financial sense than not buying into it.
- You Might Need Multiple Policies
As you know, there’s no such thing as a catch-all restaurant insurance policy. Instead, you have to build a restaurant insurance package out of multiple policies. And while you might be able to get a good deal on the half dozen policies you’ll need from one insurance provider, it doesn’t hurt to compare quotes and even buy policies from several providers.
Shop around until you find the policies that give you the best coverage for the best price. If you don’t know where to start, ask fellow restaurateurs about their insurance providers. Carefully examine bundles to make sure you need everything you’re paying for.
- Try a Business Owner’s Policy (BOP)
A business owner’s policy (BOP) is a type of insurance that combines several critical coverages into a single policy. Most BOPs combine general liability, commercial property, and business interruption insurance, and are usually cheaper bundled than a la carte.
- Consider Your Deductible Carefully
A deductible is how much you have to pay out of pocket for damages and other costs before the insurance kicks in and covers the rest. A restaurant insurance policy with a $50,000 deductible means that even though you’re paying a premium (your monthly investment to be insured), you’re responsible for paying the first $50,000 of otherwise covered costs before your insurance kicks in and pays for the rest. A policy with no deductible, on the other hand, will cost you nothing besides your premium.
Deductibles can be costly and surprising. Make sure to ask about deductibles before you buy your restaurant insurance policies. Often, the lower the deductible, the more expensive the monthly premium, and the lower the premium, the higher the deductible. Having no deductible is ideal – as long as it’s affordable. Weigh the costs of the deductible against the cost of the premium and the risk that you’ll actually need to use the policy.
To sum up, restaurant insurance is the name for a bundle of insurance policies that cover financial risks that restaurants and other foodservice establishments face. These bundles may include general liability, commercial property, workers’ compensation, commercial auto, liquor liability, business interruption, and equipment breakdown insurance plans.
When shopping for policies, make sure to get only what you need, consider your deductible, and ask about discounts on BOP bundles. While you will hopefully never have to use your restaurant insurance, having it will give you peace of mind knowing that if something were to happen, your business, staff, and customers would be protected.
This article was written by our friends at TouchBistro
TouchBistro is a restaurant point of sale and management system that helps restaurants improve operations, increase sales and create a better guest experience.