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What Type Of Insurance Does Your Restaurant Need?

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Whether you’re looking to open a restaurant or looking for new insurance for your business, picking insurance is a process that should not be taken lightly. But before you talk to the first insurance broker that comes your way, you’ll want to be informed on the types of insurance that are available to determine if you need them. For example, you will not want to pay for liquor license insurance that is included in your policy if you don’t sell alcoholic beverages in your restaurant. To help determine what you need, read about the types of insurance policies that are available for foodservice establishments.

Types Of Restaurant Insurance

Before learning about the different types of insurance, check with your state laws to see if there are certain policies that are required for businesses in your area. For example, in many states, workers’ compensation insurance and commercial auto insurance are mandatory for certain restaurants.

General Liability Insurance

The most essential type of policy your restaurant needs is general liability insurance (GLI) or business liability insurance. No matter how many precautions you take to prevent injuries in your establishment, customers and employees might slip, fall, or suffer from food poisoning. In this case, you will want to be prepared to cover:

  • Medical expenses
  • Lawsuit expenses
  • Lawsuit judgments
  • Lawsuit settlements

Workers’ Compensation Insurance

Depending on your policy, workers’ compensation might already be covered by your general liability insurance. But, if it’s not, workers’ comp is something you’ll definitely need if you think there’s a high chance your employees might get hurt during working hours. Workers’ compensation insurance offers employees benefits such as:

  • Medical expenses
  • Disability benefits
  • Make up for lost wages

This type of insurance can also be beneficial to you if your employee decides to sue as it will cover lawsuit expenses as well.

Liquor Liability Insurance

If you sell liquor at your establishment, you know how rowdy customers can get, and sometimes they might pose a danger to themselves and onto others. If an inebriated customer gets into a brawl with another customer, you’ll want to have:

  • Third-party bodily injury
  • Third-party property damage
  • Assault and battery claims

Property Insurance

When it comes to protecting your property from physical damage, there are some things you can’t protect against such as flooding from storms, fires, or earthquakes. These types of damages can seriously hinder your business or put you out of business altogether. With property insurance, you’ll be able to cover damages to your:

  • Building
  • Equipment
  • Furniture

Remember to ask the owner of the building if they have already acquired property insurance for you. You will also want to know what your property insurance covers as you may still have to cover the contents inside of the property.

Commercial Auto Insurance

If you’ve got a food truck, offer delivery, or use a vehicle to transport your catering, commercial auto insurance is a must-have. Paying out-of-pocket for an accident or injuries can be very expensive and you don’t want to be without insurance in case of an emergency. Commercial auto insurance covers:

  • Repairs to vehicles
  • Injury to drivers

Business Life Insurance

As a business owner, it would be advantageous to acquire life insurance to ensure your family and business are taken care of should you pass. With business life insurance, the responsibility of your establishment will be passed on to your business partner or a person of your choosing. You will also not have to burden your family with financial responsibilities or have them come up with a large sum of money to buy out your shares.

How Much Is Restaurant Insurance?

Restaurant owners can pay anywhere from $1,000 to $10,000 a year for business insurance. The price you pay for insurance depends on the rates of your area, the size of your business, and the type of restaurant you own. This is why the price range is so wide, so when selecting your insurance policy ask for a quote from different brokers so you can better select the policy that’s right for you.

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