Purchasing adequate restaurant insurance protects your business and employees against many risks and liabilities. You can get coverage for slip and fall accidents, workers’ compensation, commercial property damages, and business interruption. Insurance also helps pay for legal fees and settlements. Here are some common mistakes to avoid when purchasing insurance policies for your restaurant:
Incorrectly Assessing Risks
Before purchasing restaurant insurance, consult your provider to assess all risks and identify priority areas that require the most coverage. Properly evaluating your risks allows you to purchase enough coverage for accidents and other liabilities. Adequate insurance coverage also protects you from liability and medical expenses.
Policies should cover liability for professional errors, such as undercooked food. Some insurance policies also cover kitchen equipment, such as freezers, refrigerators, and mixers, in case of failure. A professional risk assessment helps verify that your chosen policy provides comprehensive protection.
Underinsuring Your Restaurant
You should purchase adequate insurance to cover all potential liabilities. Underestimating your coverage needs leaves you vulnerable to financial losses. Instead of purchasing the minimum required coverage, consult your insurance provider to help with calculations and precedence.
Comprehensive coverage usually features property damage, general liability, and business interruption. If you serve alcohol, get enough liquor liability insurance to protect your business against alcohol-related accidents. Purchase adequate workers’ compensation insurance to protect your team and business from potential workplace hazards like wet floors.
Overlooking Policy Review
Insurance policies are complex, but leading providers can explain all terms, including monthly premiums, deductibles, coverage, exclusions, and conditions. Carefully reviewing the policy helps determine if it covers all priority liabilities and risks. Find out the protocol for making insurance claims and how much you will pay in deductibles before purchasing the policy. Lower premiums usually come with higher deductibles or less coverage, but each policy is unique. Ask the insurance provider for clarification to understand your policy. Some providers do not cover flood damage, food contamination, and other risks. Reviewing the exclusions for each insurance package can help you determine if you need policy add-ons.
Maintaining the Same Policy
Your insurance policy should always provide adequate coverage for current potential liabilities. If your needs evolve due to new equipment purchases, space expansion, or employee hires, insurance can be adjusted to reflect the changes. Ask your provider about policy adjustments to protect your new equipment, inventory, and employees from potential liability. You should also review the policy annually to identify areas requiring additional coverage.
Providing Inaccurate Information
Whether accidental or intentional, providing incorrect information to your insurance provider can lead to issues and losses. Double-check all details when purchasing coverage to achieve accurate calculations for adequate coverage. All equipment, personnel, and other aspects needing protection should be included to avoid underinsuring your restaurant. Most insurance carriers only cover what is in the policy. Keeping information up to date helps verify that your needs are covered.
Get Adequate Restaurant Insurance
Insurance policies protect you from costly repairs, repurchases, and litigations. Instead of paying out of pocket or selling business assets to settle a case, the insurance provider carries your burden. Contact a reputable restaurant insurance provider today to find out more about their policies.