Owning a restaurant business is rewarding, but you must cope with the numerous risks in the hospitality industry. Pub and restaurant insurance is one way restaurant owners may avoid financial loss in a disaster. Insurance is a smart financial decision, and some coverage types are legal requirements in many states. This means you must get restaurant insurance before commencing operations and renew it consistently as long as the business remains open.

While your current restaurant insurance policy may adequately cover the business’s needs, you should adjust it regularly to match dynamic market changes. Business expansion and market factors may influence the risks your restaurant faces. Re-evaluating your business’s insurance needs may help verify that the restaurant is well covered. Here are some instances when you should get restaurant insurance:

Workforce Changes

Small restaurants are often run directly by the owner and have few staff. As the business grows, you will need more employees to help manage the numerous day-to-day tasks. Staffing changes necessitate higher insurance coverage to protect the entire employee population. Your insurer can expand your existing worker’s comp insurance to include the new workers, but a bigger cover may attract more premiums.

Worker’s compensation insurance helps protect your employees when they suffer injuries in their line of work. The policy covers treatment and medical expenses when an employee is injured. Recovering employees are also liable to disability payments to cover lost wages for the duration they cannot work. This coverage helps prevent financial loss to your business from personal injury cases or medical expenses.

Relocating Your Business

Moving from your restaurant’s current location can be a strategic decision if you are shifting to a more prominent location with more traffic. A change in business location may influence the risks you face at the new restaurant. Get a new restaurant insurance policy to cover any additional risks your business might face. A new general liability cover will help protect your restaurant from losses in the event of:

  • Rental property damage
  • Reputational risks like privacy violations, libel, or slander
  • Advertising liability, including copyright infringement or false advertising
  • Bodily injury

Buying New Equipment

New equipment at your restaurant can improve customer service but result in huge losses if they experience a malfunction. Repair or replacement expenses can be hefty, so you should insure the new equipment immediately after purchase. Consult with your insurer on how to include your new purchase in the existing commercial property insurance.

Rises or Falls in Business Income

Market changes can affect your business’s income, so you may need to get a new policy for your restaurant. During disasters like the pandemic, when business income is low, you can speak to your insurer to rethink the policy terms. Such a move helps you maintain the coverage but lowers the premiums you have to pay. Do the same when you experience a boom to maintain adequate business coverage.

Adjusting the terms of your insurance policy works well for businesses in seasonal industries like restaurants. During peak season, you will witness an increase in traffic, which increases the risk. Slower months have lesser risk, so instead of paying expensive premiums, get a new policy and free up some cash to keep the business running.

Adding New Products or Services

Top restaurant chains revitalize their business model to remain competitive. Adding products or services to your restaurant can help you serve your target market better, but it increases your business’s risk exposure. New products attract risks like product liability and intellectual property rights. While adding the product or service may make your restaurant more profitable, the additional risks may cripple the business.

Restaurant insurance experts can help evaluate your risk exposure when you add new products or services to your menu. They can then recommend the right policy to cover your business ahead of the new product or service launch. Getting restaurant insurance protects your business from losses due to legal action and bodily injury expenses.

Get Pub and Restaurant Insurance

The restaurant business can be rewarding, but you must manage multiple risks. Getting adequate pub and restaurant insurance may help keep your business profitable even in the face of adversity. Adjusting your policy terms regularly may help you enjoy adequate coverage.