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How Much Insurance Does Your Restaurant Really Need?

By Dean Laming on January 3rd, 2024

Opening a hospitality business brings the excitement of welcoming happy customers along with the reality of substantial risks requiring protection. The types and levels of restaurant insurance necessary vary widely based on their own unique operations. 

We break down key considerations for new ventures and existing establishments in determining suitable coverage, so you can confidently thrive without financial fears holding back success.

Calculating Your Restaurant’s Insurance Needs

Rather than default to bare minimum policies or mirror what competition might hold, smart restaurateurs undertake methodical assessments of their particular risks based on factors like:

Restaurant Type and Size

A small takeaway café needs less insurance than a luxury hotel dining room. Consider floorspace, seating capacity, employee headcount and typical guests served.

Location and Neighbourhood

Crime rates, natural disasters, local claim litigation tendencies and other area risks must factor in. High-risk regions need more comprehensive policies.

Years in Business

Newer restaurants likely require higher coverage limits due to unpredictability. Long-running establishments have more data documenting likely incidents and costs.

Alcohol Service

Serving drinks introduces additional liquor liability, requiring dedicated coverage beyond typical dining risks.

Evaluating along these lines determines suitable baseline targets, while adding breathing room for unexpected claims. Getting guidance from hospitality insurance experts proves invaluable before locking in policies.

Insuring Against Top Restaurant Exposures

While each restaurant’s necessary level of coverage differs, protecting against a few prominent perils proves universally essential:

Property Damage

From fire to floods and theft, property damage insurance promises replacement or repair of all physical restaurant assets, including buildings, facilities, inventory, and equipment. This enables resuming operations once the dust settles.

Public Injury 

This covers you against public liability from a guest having an accident and provides funds for expensive health care, rehabilitation and potential legal settlements arising from incidents in which you are deemed responsible.

Employee Injury

Staff accidents and work-related illnesses also happen and require insurance to fund lost wages, medical care and compensation if at fault. Having ample employer’s liability cover prevents company bankruptcy.

Food Contamination

Whether an ingredient supplier error or an internal kitchen mistake, product liability protects the business when food safety lapses sadly harm customers. This specialised cover accounts for lawsuits and reputational damage.

Business Interruption

If calamity forces a temporary closure for repairs, this insurance provides vital cash flow through the closure, so fixed costs, wages and loan payments remain addressed until reopening. This keeps minor incidents from shuttering operations permanently.

Adequate Security Brings Confidence

While there is no universal “right amount” of insurance restaurants need, fully understanding your unique risks provides directional guidance. Cover those top exposures amply, then implement strong safety procedures to minimise claims.

Here at Brisco Business, we offer dedicated restaurant insurance packages designed to protect UK food service providers like you. Our team brings decades of claims experience paired with a passion for helping restaurants thrive securely.

Get a no obligation-free quote catered to your restaurant and allow us to help you get protection that lets you focus fully on delighting customers rather than worrying over risks. Let us serve up security so you can serve up success.

Dean Laming

Dean is a Chartered Insurance Broker with more than 25 years insurance experience. Through various underwriting, operational and management roles, Dean has built up extensive knowledge of how to run a business and is now Managing Director of Brisco Business, part of the wider Henry Seymour Group.

All articles by Dean Laming

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