What business owners should know about restaurant liability insurance
2 Minute Read
You’re passionate about food, and you’ve funnelled that energy into opening the business of your dreams – a restaurant. You’ve found an ideal location, perfected a drool-worthy menu and hired great staff. But what about restaurant insurance?
What is restaurant insurance?
Imagine a delivery person slips on a freshly washed floor, a customer develops a bad case of food poisoning, or a power surge blows out your restaurant’s freezer, resulting in food that has to be thrown away.
As unpleasant as it is to imagine negative situations arising at your restaurant, dealing with them without proper financial coverage is even worse. That’s where restaurant liability insurance can help – by providing coverage for claims related to your professional activities.
What are the basic coverages?
Just as every restaurant is unique, every policy package can be customized for your individual business needs. However, several policies apply to most businesses and form the components of a comprehensive restaurant liability insurance policy. These include:
Commercial General Liability insurance
A foundational policy for any business, Commercial General Liability (CGL) insurance provides coverage for common claims of bodily injury or property damage to a third party resulting from your business operations. This is often referred to as “slip-and-fall insurance” and covers associated legal and medical expenses.
Commercial Property insurance
Providing financial coverage for loss or damage to your business property and physical assets – resulting from situations such as a kitchen fire, theft, or vandalism – Commercial Property insurance is important whether you rent or own your space.
Equipment Breakdown insurance
If you are required to repair or replace broken equipment due to an internal cause, such as an electrical or mechanical issue, Equipment Breakdown insurance will help cover your costs.
Business Interruption insurance
In the event of a disaster that requires your restaurant to close, Business Interruption insurance covers the income lost while you restore or rebuild your business. In addition, Business Interruption insurance may cover overhead costs (such as rent and electricity) and staff wages.
Cyber Liability insurance
Cyber attacks or data breaches are a threat to any business – and restaurants are no exception. If you use a point-of-sale system, run a website, have in-restaurant WiFi, or store any customer information, you are at risk of having these systems compromised. Cyber Liability insurance covers damages associated with theft, corruption and disruption of electronic data.
Product Liability insurance
You work hard to maintain food quality, but what if a customer experiences a severe allergic reaction after consuming a product not properly labelled for allergens? Product Liability insurance has you covered – protecting your business from claims related to food-borne illnesses (such as Salmonella or allergic reactions) and claims of physical harm caused by food or beverages. Product Liability insurance can help cover any legal fees and potential settlements.
Take the next step towards restaurant liability insurance
Ready to learn more about how to protect your restaurant? Consider the CAA Business Membership. In addition to insurance, your Membership gives you access to an à la carte menu of innovative business solutions – including Commercial Roadside, Commercial Pit Crew, Group Benefits and Employee Memberships.
You can request a free quote and discover how our competitive pricing makes quality coverage affordable for your business. To learn more, visit CAA Business Membership.
