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It is critical to have insurance to protect yourself and your staff while running a restaurant. Since your restaurant is your primary source of income and livelihood, you must guarantee that it is properly covered in the event of an accident. So, what kind of insurance do you need for your restaurant? Let’s look at the different types of restaurant insurance, what they cover, and why they’re essential for your company.
Worker’s compensation is restaurant coverage for medical bills and wages in the case of an injured employee. It is common for employees to get injuries in the restaurant business while working in a hot kitchen, and they can get burned, cut, or fall in the workplace. If an employee is in recovery and cannot work, the business would lose money through wasted wages. Worker’s compensation helps pay for these expenses to the company. This is required by almost every state for a business with employees. Workers’ compensation ensures that an employee will be taken care of if there is an accident, and the restaurant won’t have to take a substantial financial hit. According to insureon.com, “The amount you pay for workers’ compensation is a specific rate for every $100 of your business’s payroll.” This should also be assessed when applying for workers compensation. You need to think about how many employees you want to hire and how much you are willing to spend.
Commercial general liability insurance is a must to secure your restaurant. Employers are covered by commercial general liability insurance if they cause property or personal damage. The Commercial General Liability also covers legal defense fees, court, medical fees, and funeral expenses. However, it does not cover the employee from injuries, you would need workers’ compensation. Your company will also be protected against personal and advertising injury, such as slander and libel. You’ll want to invest in commercial liability because lawsuits are common in the restaurant sector and may be costly to your business. According to LandesBlosch.com, Commercial General Liability also covers food poisoning, customer burns, and can cover medical bills up to $5,000. However, these costs can escalate but are almost covered by the commercial general liability insurance.” Lastly, it can also cover injuries and property damage due to the consumption of alcoholic beverages at a social event.
Commercial Property insurance covers your business’ property against accidents, storms, burglaries, or vandalism. This type of insurance does usually cover natural disasters like earthquakes or floods. When a disaster hits, the commercial property will cover the inside of your restaurant and outside the facility. It also covers equipment, documents, and inventory. For example, if your Point of Sale system or credit card processing system gets damaged in a flood, commercial property will cover the cost of a replacement. It will also cover the expenses if any of these events happen to your restaurant.
Commercial Umbrella insurance is simply an additional form of security, and it will cover extra liabilities if need be. A commercial umbrella covers the exact charges that your general liability insurance would cover, such as medical and legal expenses and damages involved with a lawsuit. According to HKinsurance.com, This policy kicks in where your underlying policy’s coverage left off and up to the limit purchased. Restaurant umbrella policies are available to all classifications of restaurants from quick serve to fine dining and can range from $5 million—$250 million limit options to satisfy any restaurant.”