What insurance do you need as a restaurant owner?
For a restaurant owner without adequate insurance, it can take little more than a slip and fall or a food poisoning lawsuit to nearly put you out of business.
Insurance is an essential investment for every restaurant to stay afloat, but the cost will depend on your specific business and the type of coverage you require. To get you started, here’s a list of the most common types of restaurant insurance every owner needs to protect their business.
1. General liability insurance
If a server or customer slips and falls in your restaurant, not having insurance could be costly. General liability insurance is one of the most common insurance types and protects your business from financial liability in the event of bodily injury or property damage.
The cost of general liability insurance will vary based on how many years you’ve been in operation, your business location, your risk exposure, and your coverage limits.
General liability insurance typically covers:
- Legal costs and medical expenses should a customer be injured on the premises of your restaurant.
- The cost to repair or replace any property damaged by your restaurant or employees.
- Legal costs should any claims of slander or libel arise against your business.
- Financial coverage should a customer claim your food caused harm or illness.
- Any expenses associated with damage caused by your advertising.
2. Workers’ compensation insurance
A restaurant requires many different employees for the business to operate, including managers, cooks, and waitstaff. Workers’ compensation insurance helps protect your restaurant by reducing financial risk in case of work-related accidents. It covers medical fees and lost wages for employees who experience injuries such as:
- Fall, slip, or trip
- Cuts, punctures, and scrapes
- Muscle sprains or strains
3. Business owner’s policy (BOP)
A business owner’s policy protects your restaurant in the event of personal injury, property damage, fire, and more. The policy bundles both liability and property insurance and is designed to provide tailored coverage based on the unique needs of your business.
Your business owner’s policy will typically include:
- Commercial property insurance for your building, kitchen equipment, and food inventory in the event they are lost or damaged in a fire, explosion, vandalism, or smoke.
- Commercial liability protection to protect you financially in any instance of business-related damages to others, like injury or property damages.
- Business interruption insurance to keep your business up and running in the event of a disaster and support your business by covering payroll or relocation costs.
4. Commercial automobile insurance
Does your restaurant run deliveries, operate a food truck, or deploy a work vehicle of any kind to run errands and pick up supplies? If so, you’ll need commercial auto insurance.
Your auto insurance will generally cover:
- Auto liability to protect your restaurant from claims of bodily injury or property damage caused by your work vehicle.
- Physical damage coverage for the costs of repair or replacement in the event of theft or vandalism, hail, or collision.
- Uninsured or underinsured motorist coverage should a driver who does not have adequate insurance be involved in an accident with your work vehicle.
5. Cyber risk or cyber liability insurance
Cyber risk or liability insurance provides coverage should employee, customer, or company information be stolen in the event of a data breach. Storing sensitive information like customer credit card information or employee social security numbers can make you a target for criminals and hackers.
Cyber risk insurance will typically cover:
- Recovery, credit monitoring, business management, or cyber extortion expenses should your data be stolen.
- Network privacy, security, or errors and omissions protection should your restaurant be sued as a result of cybercrime.
6. Professional liability insurance
Also commonly referred to as errors and omissions, professional liability insurance protects you in the event a customer believes they’ve been harmed by your food or services.
You can use this insurance coverage to help compensate these customers, or to pay for lawsuits related to claims against your restaurant.
Professional liability insurance protects your restaurant business from negligence, inaccurate advice, misrepresentation, and violation of good faith.
7. Small-group health insurance
To keep your employees healthy and happy, you’ll want to invest in small-group health insurance to cover wellness-related costs. Health insurance is also something many employees consider when looking for work.
Your small group health insurance will often include dental, medical, and vision care.
8. Specialized coverage
Depending on the type of restaurant you run, you may need specialized coverage on your insurance policy. Speak with a professional insurance agent to see if your small business requires any kind of additional coverage. They can help you build the right insurance policy to cover your unique business needs.
Is your restaurant covered?
As a restaurant owner, it’s important to have the right insurance in place to protect your business from potential risks.
Of course, ownership comes with a certain amount of risk as well. Your employees may face hazards such as burns, cuts, slips, and falls. Customers could become ill from contaminated or improperly handled food. And the restaurant itself could be damaged due to fire or catastrophic weather.
Fortunately, when you carry the right types of restaurant insurance, your customers, employees, and small business property may be covered. Get a quote in minutes and save up to 30%. It’s as easy as pie.