Restaurant Insurance

Restaurant owners can expect to pay an annual fee of £500 to £8000 to insure their business. This is an estimate, as the cost can vary according to several factors, such as the nature of your restaurant and the insurance market.

The Financial Services Register is a public database of entities that are or have been regulated by the Prudential Regulation Authority, the Financial Conduct Authority, or both.

When determining the legitimacy of an insurance company, you can use their Financial Services Registration or Firm Registration Number to do so.

If you’re ever unsure of anything to do with restaurant insurance, then keep reading our restaurant insurance FAQs or get in touch with our team of insurance experts who will gladly be of assistance.

Not having sufficient employers’ liability insurance cover can result in your business being on the receiving end of fines.

Also, if an employee makes a claim against you, your company will have to foot the bill for compensation and legal costs, as opposed to your insurance company handing it. Many business owners don’t realise that even a single claim can have enough financial impact to drive a small or medium-sized business into insolvency.

Insurance cover can be quite expensive but don’t take the risk; always make sure you at least have employers’ liability insurance, as in most cases, it is required by law to have it.

The length and ease of the claims process can depend on several factors, but two of the main ones are the industry a business is in and the extent of the damage it has sustained or caused. Additionally, because insurance businesses operate differently and have different claims processes, there is no easy way of saying how long the average process takes.

Here is the general commercial insurance claims process:

1. Initial contact with your broker – When an incident occurs, your broker is the first person to contact you. This is because they understand the ideal steps for these situations. Once you provide your broker with a detailed list of stolen or damaged items and any adjoined evidence, an adjuster will follow up to continue the process.
2. Claim investigation commences – An adjuster continues the claims process by determining the amount of loss or damage covered by your insurance policy. Another duty of the adjuster is to identify liable parties. This can be expedited by providing witness statements or relevant contact information.
3. Policy documents reviewed – Upon the completion of the investigation, the adjuster will go through your policy to determine what is covered and what isn’t. At this stage, they will inform you of any applicable deductibles.
4. Damage evaluation performed – To accurately determine the extent of the damage, an adjuster may hire appraisers or contractors to provide expert advice. Once the damage assessment is done, the adjuster may provide a list of preferred vendors to rectify the damage.

You may or may not be obligated to use those vendors, but that depends on what your policy says.

5. Payment is arranged – After the damage has been rectified via either repairs or replacement, the adjuster will contact you to discuss claim settlement and payment. The time it takes for your payment to come through depends on how complex or severe your situation is.

The following are some major threats to your business operations and reasons why you should invest in restaurant insurance:

• Food safety – Restaurant owners always need to ensure that their restaurant practices the best food handling and storage practices. Even if restaurant staff have undergone rigorous training, this does not eliminate the possibility of contamination resulting in food poisoning.
• Injuries – Restaurants can be incredibly hazardous during peak times. Unmopped puddles of liquid are one of the main causes of broken dishes and injuries. Open flames, hot grease, and sharp knives are also the source of many workplace accidents within the restaurant business.
• Fire – Restaurant kitchen fires are an extremely common occurrence, especially in restaurants with deep fat fryers. Additionally, kitchen staff generally work close to one another, so if a fire breaks out and staff panic, people could be seriously injured. Injuries and fire damage could have an immense impact on your business.
• Theft – Thieves often see restaurants as a lucrative target, given the daily traffic volume and patrons paying for their meals in cash. Even if your establishment doesn’t keep cash on site, thieves may still break in and cause considerable damage to the property.
• Business interruption – Due to its client-facing nature, the hospitality industry was one of the hardest hit by the COVID-19 pandemic. A lengthy interruption in operations can easily cause a restaurant to go out of business.

If you’re looking to reduce your premiums, then improving your restaurant’s safety is a good place to start. Improving your safety means reducing risk factors, which means you will be seen as less risky to insure. Do note that doing the following may not necessarily decrease your premiums dramatically:

• Implement safety protocols – If an incident is out of your control, such as a fire, you should, at the very least, have a procedure that staff and patrons can follow to ensure their safety. The last thing you need is your staff rushing in a panic, unsure of where to find the nearest exit.
• Install an alarm system – This one may seem obvious, but many restaurant owners still see their brick, mortar and a couple of chains as enough security. Even if you don’t think you need an alarm system, it’s better to be safe than sorry. Your insurance will also immediately recognise this measure and may adjust your premium accordingly.
• Train employees – Your staff need to receive comprehensive training about the importance of hygiene and food safety. They should also learn how to use equipment or machinery safely. A key part of this is ensuring ongoing training so that staff have updated their knowledge.
• Invest in safety equipment – A lot of problems can be solved and incidents prevented by investing in safety equipment. Safety equipment is not necessarily the fanciest stuff on the market, but it can be items such as anti-slip shoes, wet floor signs, cut-resistant gloves, and safety mitts.

Investing in these items can be the difference between successfully defending yourself against a lawsuit or paying out a hefty settlement.