I love a good restaurant! Not just because I love to eat tasty dishes at family owned businesses, which is a major plus, but because I know that I can offer them the best insurance product on the market for the restaurant business industry that includes additional coverage that other companies aren’t offering them. I find this line of work particularly rewarding because restaurant owners work hard and long hours for small profit margins. Every dollar counts when trying to run a successful restaurant and when I can help them spend their insurance dollars wisely; it drastically helps the restaurant business. This blog outlines the types of insurance every restaurant owner needs to protect their business.
It doesn’t matter what kind of business you have, you need general liability coverage. When we are talking general liability we are mainly talking about property damage, bodily injury damages, personal and advertising injury damages, and damage to premises rented to you. An example would be if a customer walks into a restaurant, slips and falls on a wet floor, and sues the business. All businesses, especially restaurants, need general liability insurance. Most insurance companies package general liability insurance in what is called a Business Owner’s Policy or BOP. The business owner policy includes additional coverage for the building if the restaurant owner owns the place of business; business property coverage for the table, chairs, décor, and most importantly, all of the cooking equipment including the refrigerator, grills, etc.; as well as other relevant built in coverage and additional endorsements of potential risks businesses face.
Worker’s compensation is another type of coverage that is very important when dealing with insurance for a small business. The restaurant business is no exception. Legally, worker’s compensation is a requirement if you have three or more employees. However, a restaurant owner may want to consider coverage even if they only have one employee because there is still an exposure. Worker’s compensation insurance is a means of protection for the business and the business owner in the event of an employee being injured on the job. This could be something like a cut on the finger or back problems developed over a long time from carrying heavy trays. Worker’s compensation benefits are potentially limitless and could devastate a business without coverage. The average cost of worker’s compensation varies by business, but is typically based on the annual payroll of employees. When you are looking for quotes on worker’s compensation insurance it is helpful to look at the rates offered for your class of business.
Commercial auto insurance is a similar coverage to personal auto insurance, but commercial is for vehicles owned by or used in the course of business. A commercial auto policy includes liability protection, comprehensive, collision, towing, and rental car coverage. In addition, a commercial auto policy can include coverage for “non-owned,” and “hired autos.” An example for a restaurant owner would be that the restaurant runs out of tomatoes during a lunch shift and the owner asks one of the employees to run to the store. The employee jumps in his own vehicle, goes to the store, and has an accident. Now, the employee claims he would have never had the accident had the restaurant owner not instructed him to go to the store. Depending on the type of business, the average cost of commercial auto insurance isn’t all that different from personal insurance.
Employee Practices Liability Insurance
Aside from being a mouthful to say, EPLI can be a life-saver for any business, particularly for any type of restaurant. Employee practices liability insurance is an optional coverage that protects the owner from cases and accusations of wrongful termination, sexual harassment, and discrimination. This is quickly becoming one of the largest legal battles in our court system today. Having an employee sue the business can become a costly ordeal that many small business won’t survive. EPLI helps pay for legal fees and settlements so the restaurant owner doesn’t have to. This coverage is particularly important in the restaurant business where its occurrence is becoming more common. Small businesses are particularly at risk because they often don’t have exact job descriptions, duties, or employee handbooks clearly defined and available.
Data Breach Liability
Data breach liability is an example of how insurance changes over time to address the changing needs of businesses. Every restaurant owner needs to have data breach coverage. Although it is not technically a requirement by law, data breach is something everyone has seen the effects of. The popular store, Target, is a perfect example of a business falling victim to a data breach (think when hundreds of customer’s credit card information was stolen). This means that small businesses are at risk too. In fact, more than 60% of cyber-attacks are against small businesses. Hackers know small businesses, like restaurants, are easy targets because they often lack the level of security of a bigger business. Data breach liability will protect the restaurant business from any lawsuits that stem from a data breach, whether it is cyber based, or even something like credit card info being copied down on a piece of paper and stolen. A company, bog or small, that keeps any type of personal client information needs this coverage. Restaurant owners can purchase data breach response coverage as well, which notifies customers if a data breach occurs and offers credit monitoring as required by law. The average cost depends on the amount of coverage desired, but can usually be added onto a BOP at an inexpensive price compared to an actual breach.
The bottom line is, Insurance for a small business is so important. Often times business owners potentially risk their own assets when there is a law suit. Restaurant owners need a business owner policy that packages liability with protection for their business assets with other important protection built in. They need worker’s compensation to help pay the cost of medical bills for employees injured on the job. They need commercial auto for any vehicles they own and use in the course of business. They need to consider adding important coverage like data breach and employee practices liability for the best protection possible. If you or someone you know owns a restaurant in the DC, MD, or VA area, have them contact an independent insurance agent like the gentlemen at Bridge First Insurance to discuss this coverage as well as other important coverage options you may have any questions about!
Speak with a Bridge First Insurance Agent today! (571) 249-3857
Previously on the Blog:
Jack has achieved success in the insurance industry through a consultative and honest approach to clients. He designed this approach around educating clients on important coverage and allowing them to decide what policy would best fit their insurance needs. In 2013, Jack and co-founder Dave Zappacosta, established Bridge First Insurance, as an independent insurance agency operating in Virginia, DC, and Maryland.