This is the first in a series of blog posts about making sure you have the right and best insurance coverage for your restaurant. In this first article, we discuss why it is so important for your agent or broker to have expertise in your specific industry.
Getting Insurance Right
Deep fryers, open flames, liquor – beyond being legally required, there is no doubt that restaurants need insurance. Restaurants have some pretty unique risks; your average dentist doesn’t need to worry about a deep fryer burning down the building – hopefully.
Here’s the thing though, no one wants to talk or think about insurance. (So, I’m trying to make this as painless as possible.) Getting familiar with what you need, have, and don’t have is good business – even if it’s not very exciting. Do you know what is exciting? When something happens, and you don’t have to think twice about the impact it’s going to have on your business and livelihood.
The Truth About Restaurant Insurance
We’re going to let you in on a secret. Without getting too much into the weeds, independent restaurants are by and large underserved by the insurance industry — sorry folks. Local agencies may not have the expertise to get you the right coverage, while the bigger brokers may have the expertise, but aren’t interested in what they consider ‘too small of an account’. Neither will admit to it, but that’s what is going on.
Insurance and risk management are complicated (and boring). No one understands the geeky acronyms or terms, and no one really wants to – we just rely on our insurance ‘guy’ to make sure it’s all taken care of.
As a result, most restaurants do not have the best insurance coverage for their business. For example, you may not even know this, but your restaurant might not be covered for food contamination. That’s right, something so basic–a real no brainer– and yet it happens all the time. And it’s not because your local broker is trying to ‘save’ you money. It’s most likely that they simply didn’t see the exclusion in the insurance policy fine print. Don’t get me wrong, most local agents and brokers are fabulous. They’re just not necessarily restaurant insurance experts.
Another great example of how getting specific restaurant insurance expertise will come in handy: not long ago during a windy and rainy evening, a tree came down and knocked out internet and phones at several Westchester businesses, including a popular pizza place. They could make their fabulous pizza, but couldn’t take any orders! It took about three days to get phones and internet restored, and during that time, the restaurant experienced a loss of about 80% of their usual business over the course of those three days.
Now, you’re thinking: that’s OK, they have business income insurance that will cover the loss. Yes, but NO. Most business income policies only kick in after 72 hours from when the loss happens. And it’s no coincidence that most events are solved within 72 hours. What restaurants really need is insurance that covers losses within that critical 72-hour period. Knowing that and understanding how to work around it requires expertise and experience.
So, rule #1 about getting the right, most affordable coverage for your restaurant: EXPERTISE. Specific expertise in restaurants. Don’t settle for less. It’s just too costly both on a monthly basis, and if/when something happens.
To get a free, no-obligation analysis of your restaurant’s insurance policy, contact us and tell us you want us to take a look at your policy!
We’ll tell you if anything is missing, or if you’re totally covered.