Restaurant Owners Insurance
We understand many restaurant owners operate on a small margin of profit. One of the areas a restaurant owner can look to reduce their overall operating expenses is to shop their insurance by talking to an independent agent who will work with you to match your specific needs and budget.
As with any business the restaurant owner must carry General Liability insurance. This protects you for third party liability claims that can result in bodily injury and/or property damage as a result of your operations. Aside from a slip and fall claim you will be insured if a patron becomes ill and claims it was something they ate at your restaurant that caused them to be sick. The standard limit of liability is $1,000,000 each occurrence and $2,000,000 in the aggregate but some companies will offer higher limits of $2,000,000 each occurrence and $4,000,000 in the aggregate for a small additional premium.
If you serve alcoholic beverages you need liquor liability coverage which is a separate limit on your policy. The insurance premium for this coverage is based on your annual sales of alcoholic beverages. If you are a fine dining establishment you will be given some monetary consideration on the rate where the alcohol sales are derived from the sale of fine wines.
The property section of your insurance policy will cover business personal property and build outs insured against loss. One of the areas included in the property section of your policy that does need close attention is coverage for valuable papers. All restaurant owners’ insurance package policies contain a sublimit for this coverage but it might not be enough because this portion of your policy pays for you to recreate your recipes should an insured loss destroy your records. For high end restaurants this could involve the cost of an expensive Chef to handle this for you and it can really add up. The sublimit is usually $10,000 so make sure this is discussed with your agent.
If you own your building or you are under a triple net lease agreement then coverage for the real property needs to be purchased.
In the unfortunate event of an insured loss the policy will include coverage for both your lost business income and your extra expenses incurred as a result of the damage. You should maintain a lost business income limit that will cover you for at least 12 months. Once your business is up and running again you will want to announce that and get your customers back. The extra expense coverage will pay for you to advertise that you are back in business.
Workers Compensation is required if you have employees. If you offer delivery service and your employee is driving his or her own vehicle to do these errands purchase Non- Owned Automobile Liability insurance to protect you in the event your employee is involved in an accident and they are legally liable for injury or property damage to a third party. You can be held liable for these same damages since they were on your company business when the claim occurred. The Non-Owned Automobile Liability will protect you and can be endorsed to your policy at an affordable rate for a limit of $1,000,000 each occurrence.
There is a lot to think about. Contact your insurance professional at EZ Center Insurance Services to design a policy that will fit your needs and your budget.