When it comes to restaurants, it isn’t a matter of if an insurance claim will be filed, but when.
The hazards of preparing food, serving customers, and balancing the books mean that food-related businesses are exposed to a lot of risk. And the first step to creating a safer work environment is knowing what those risks are.
As exciting as it is to develop a menu, decorate your dining room, and deck out your kitchen, it’s even more crucial to protect yourself against the most common restaurant insurance claims.
1. The Most Common Restaurant Insurance Claim: Fire Damage
Perhaps unsurprisingly, one of the most common restaurant insurance claims is property damage related to fire. Combine open flames with the intense pressure of working on a busy Friday night and you’ve got a recipe for disaster.
However, just keeping a few fire extinguishers on hand isn’t enough. It is vital that all employees have comprehensive fire safety training to reduce the likelihood of accidents. In addition, all equipment should be regularly cleaned and safety checked to prevent it from burning down your restaurant when you close up for the night.
2. Staff and Patron Injuries
Other common restaurant insurance claims involve injuries to either restaurant employees or patrons.
Every accident is a potential lawsuit waiting to happen, so it is essential to be insured against these eventualities.
Accidents are more than just a case of food poisoning or a customer getting hot soup poured on their lap. It can also mean a slip and fall on the uneven sidewalk outside your place of business or an employee losing a finger when operating kitchen equipment.
And the danger doesn’t stop when your customers drive away in their car. Without the right liquor liability coverage, you could be on the hook if a drunk patron crashes their car on the way home.
3. Food Spoilage
Every good restaurateur has a system in place to prevent foodborne illness—cook food to the proper temperature, throw away contaminated food, and keep raw chicken far away from produce.
But what happens if you have to replace everything due to a power outage? Or your latest delivery of ground meat is tainted with E. coli?
Food spoilage and contamination coverage can help reimburse you for the costs of replacing all that food (and cleaning all your equipment) so you can get back to business. It may even cover medical tests or vaccines for your employees.
4. Theft
Unfortunately, theft is a common experience in the restaurant business. And it doesn’t always come in the form of an armed robbery or a dine-and-dash. A very common form of theft actually comes from employees themselves, who may steal from the cash register or skim some stock from the kitchen.
Make sure your insurance policy has specific coverage for this type of theft, as it is a lot more common than you think. In addition to this, make sure to install surveillance cameras throughout your place of business.
5. Data Breach
When you think of restaurants, most people tend to think of food, not numbers. But cyber criminals aren’t most people.
Odds are, the more business you do, the more credit card numbers you have. And—especially if you’re a small Mom-and-Pop operation—thieves and hackers are willing to bet that you don’t have high-tech security measures in place, making you the perfect target for a cyberattack.
Data breach is a lot more common than you think and remediation costs can be enough to put most restaurant owners out of business.
We Cover Common Restaurant Insurance Claims
An ounce of prevention is worth a pound of cure, but you can’t prevent damage and/or loss every time. Sooner or later, you’ll have to file a claim. The question you have to ask yourself is, “Am I covered?”
A Business Owner’s Policy is crucial for any business, but it doesn’t offer comprehensive insurance coverage. To truly protect your business, you’ll need to have a network of policies that cover multiple risks:
General liability insurance
Property insurance
Business interruption coverage
Liquor liability insurance
Food contamination insurance
Employee theft insurance
Workers’ compensation insurance
Employment Practices Liability Insurance (EPLI)
Commercial auto insurance and fleet coverage
Data breach/Cyber liability coverage
Make Sure You’re Protected
At any given moment, all businesses are only one mistake away from having to close their doors for good. But with the right food business insurance, you can be compensated for that loss so you can keep feeding customers and paying employees for a long time to come.
The right types of restaurant business insurance can provide a safety net when (not if) you need to make an insurance claim. But the last thing you want is for your claim to be denied because you don’t have the proper coverage.
Because we’ve been one of Orlando’s premier insurance agencies for more than 30 years, and have written thousands of commercial policies for restaurants just like yours, we are confident that we can find a policy that fits your needs.
Call now to discuss your options or submit a free quote if you know what you need.
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