INSURANCE COVERAGE OPTIONS

There are many options for restaurant insurance. In most cases you will start by selecting a General Liability (GL) policy or a Business Owners Package (BOP).

A GL policy is typically selected when you are leasing the building, and you do not want property coverage. This type of insurance generally covers injury or accident where you are legally required to pay damages to another. Examples could be things like slip and fall, damage to a rented property, product liability (usually food), and other covered liabilities.

A BOP policy includes the General Liability coverage, plus a package of other coverage’s. This type of policy will normally have the option to insure the building, and/or your leasehold improvements and contents. Other coverage’s may include food spoilage, loss of business income, burglary, employee dishonesty, valuable papers, and more.

After you have selected a GL or BOP policy it is important to consider the liability limit. Usually the GL coverage will be $100,000 or greater. For additional premium you may be able to increase that to as much as 2 million or more. It is advisable to get at least 1 million for liability coverage.

If you go with a BOP package there will probably be an option to get an “actual cash value” policy, or a “replacement cost” policy. The replacement cost option costs more because in the event of a claim depreciation will not be deducted from the payment to you.

A Business Owners Policy will usually have an option for the deductible. This will typically range from $500 to $5,000. Higher deductibles will reduce your insurance premium, but will result in more out of pocket if you have a claim.

Be sure to ask your agent about other possible upgrades to your policy. This can include thinks like non-owned auto coverage, outdoor signs, sewer backup, equipment or machinery breakdown, and more.

A GL or BOP policy will probably not be the only policy that you need. Here are some other products to consider.

• Workers Compensation – Very important if you have employees.

• Business Vehicle Insurance

• Flood Insurance – Flooding is normally excluded from a BOP.

• Health Insurance – For the owners and or employees.

• Key person life insurance

• Business Liability Umbrella – Covers claims that exceed the underlying policy limits.

As disclaimer, information on this page is for general information to help you select coverage. All policies have limits and exclusions. Your actual coverage will be as described in your policy documents. Please consult one of our licensed staff members for help selecting coverage, or for any questions.
 

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