INCLUDING:  Bars • Brew Pubs • Buffets • Cafeterias • Caterers • Clubs • Drinking Places • Ice Cream Stands • Lounges • Lunch Counters • Lunchrooms • Nightclubs • Pizzerias • Restaurants • Sandwich Shops • Taverns • Tearooms

Bars, taverns, restaurants, cafeterias, and other eating and drinking places have very high insurance needs in three separate areas. The first is property protection for physical damage to equipment, furnishings, building and supplies due to fire and other perils. The second is premises liability coverage to protect customers due to slips, trips and falls on the premises, as well as for consumption of food products. The final need is protection for employees due to frequent cuts, burns and other common employee injuries. Establishments that sell or serve liquor or other alcoholic beverages also need liquor liability coverage.

 

Package Policies

Package policies are the most convenient way to combine coverages. Some eating and drinking establishments are eligible for coverage in a businessowners policy. Most others are eligible for a commercial package policy and can use its flexibility to meet their specific coverage needs.

Businessowners Policy (BOP)

Commercial Package Policy (CPP)

Property Coverages

Restaurant kitchen equipment, inventory and dining room fixtures are common exposures for most eating and drinking places. Many of these establishments do not own the buildings they occupy but have long-term leases and have invested money in various improvements and betterments, including cooking equipment, dining room decorations and permanent fixtures. A thorough property inventory helps to determine the items to classify as building and as business personal property separate from improvements and betterments. Two primary potential loss exposures that must be covered are fire, because of cooking operations, and theft, due to the presence of liquor and other valuable inventory on the premises. Time element coverage is important and should not be overlooked. A peak season endorsement is important if the operation has any periods of higher sales activity compared to normal activity.

Types of Property

Building

Business Personal Property

Personal Property of Others

Improvements and Betterments

Property Coverage Forms

Building and Personal Property Coverage Forms

Builders Risk Coverage

Commercial Output Policies

Condominium Coverage Form–Unit-Owners Coverage

Equipment Breakdown Protection Coverage (AKA Boiler and Machinery Coverage)

Legal Liability Coverage

Perils Insured/Causes of Loss Forms

Basic

Broad

Special

Earthquake

Flood Coverage

Mine Subsidence

Property Coverage Options to Consider

Debris Removal Coverage

Ordinance or Law Coverage

Outdoor Trees, Shrubs and Plants Coverage

Spoilage Coverage

Utility Services–Direct Damage Coverage

Valuation Options

Peak Season Limit of Insurance

Replacement Cost

Value Reporting

Time Element Coverages

Business Income with Extra Expense Coverage

Business Income without Extra Expense Coverage

Extra Expense Coverage

Leasehold Interest Coverage

Time Element Coverage Options to Consider

Business Income from Dependent Properties Coverage

Ordinance or Law Increased Period of Restoration Coverage

Utility Services–Time Element Coverage

Inland Marine Coverages

Eating or drinking places must be open-minded and receptive to change or be ready to close their doors. Because of the constant demand by customers for something different, the inland marine coverages should be reviewed periodically as the possible means for providing coverage if the insured begins offering services at off-site locations, for computerized cooking equipment and for the fine arts added to enhance the building décor, to name a few.

Accounts Receivable Coverage

Bailee Customers Coverage

Commercial Articles Floaters

Difference in Conditions (DIC) Coverage

Electronic Data Processing Equipment Coverage

Fine Arts Coverage

Scheduled Property Coverage

Signs Coverage

Theatrical Property Coverage

Transportation Coverage

Valuable Papers and Records Coverage

Crime Coverages

Employee theft is a constant concern at eating and drinking places because of the attractive nature of the inventory. The type of coverage needed depends on the way the establishment operates and the covered causes of loss form that applies to the property coverages. If operations such as catering are conducted at off-site locations, consider using the clients' property coverage form.

Computer Fraud Coverage

Employee Theft Coverage

Forgery or Alteration Coverage

Funds Transfer Fraud Coverage

Inside The Premises–Theft of Money and Securities Coverage

Inside The Premises–Robbery or Safe Burglary of Other Property Coverage

Money Orders and Counterfeit Money Coverage

Outside The Premises Coverage

Crime Coverage Options to Consider

Clients’ Property Coverage

Extortion Coverage

Inside The Premises–Robbery or Safe Burglary of Money And Securities Coverage

Inside The Premises–Robbery or Burglary of Other Property Coverage

Inside The Premises–Theft of Other Property Coverage

Lessees of Safe Deposit Boxes Coverage

Securities Deposited With Others Coverage

Surety Coverages

Eating and drinking establishments normally must provide a bond to secure the necessary license and permit required to operate. In addition, if the business is obligated by contract to supply food and/or drinks to a government entity, it will be required to supply a contract-performance of service or supply bond.

Contract–Performance of Service or Supply Bonds

License and Permit Bonds

 

Commercial Liability Coverages

Slips and falls, along with customer illness due to being served tainted food or drink, are the primary liability exposures of these businesses covered by a commercial general liability (CGL) coverage form. It is important to note that liquor liability coverage is excluded under the CGL form if a risk is in the business of servicing alcoholic beverages. Many establishments in this category should therefore consider purchasing a separate liquor liability coverage form.

Commercial General Liability (CGL) Coverage

Employee Benefits Liability Coverage

Employment-Related Practices Coverage

Liquor Liability Coverage

Owners and Contractors Protective (OCP) Liability Coverage

Railroad Protective Liability Coverage

Special Events Liability Coverage

Commercial Auto Coverages

Eating and drinking establishments normally do not have a commercial fleet exposure unless they deliver or cater off-site events. The insured may need a garagekeepers coverage form if valet parking operations are performed on the premises that could result in damage to patrons' vehicles.

Auto Medical Payments

Business Auto Coverage

Collision Coverage

Comprehensive Coverage

Garagekeepers Coverage

Hired Cars

Nonownership Automobile Coverage

Uninsured/Underinsured Motorists Coverage

Workers Compensation Coverages

Most employers are required by state statute to provide coverage for on-the-job injuries sustained by their employees through a workers compensation policy. This coverage is particularly important to most eating and drinking establishments because of the frequency of burns, cuts and slip and falls. If the establishment is located on a wharf, pier or watercraft, the Longshore and Harbor Workers' Compensation Act endorsement should be added to the policy.

Workers Compensation and Employers Liability Coverage

Longshore and Harbor Workers’ Compensation Act Coverage

Stop-Gap or Employers Liability Coverage

Excess and Umbrella Coverages

Whenever and wherever a crowd exposure is found, the potential for a catastrophic loss exists. Because of this, an excess or umbrella liability policy should be considered by most eating and drinking places. Higher limits should be considered by any establishment serving alcoholic beverages.

Excess Liability Coverage

Umbrella Coverage

Specialty Coverages

Eating and drinking places may have exposures they have never considered or even thought about. This list is a sample of coverages that some clients should consider if one or more of those exposures exists.

Property and Casualty Coverages

Business Legal Expense Coverage

Directors and Officers Liability Coverage

Environmental Impairment Liability Coverage

Fiduciaries Liability (Pension, Welfare And Employee Benefit Funds) Coverage

Identity Theft Insurance Coverage

Internet (Cyberspace) Liability Coverage

Pollution Liability Coverage

Risk Retention Group Liability Coverage

Tax Liability Coverage

Weather Coverage

Life and Health Coverages

Athletic Teams Accident Coverage

Group Life Insurance

Health Insurance

Hospitalization Insurance

Key Person Life Insurance

Partnerships Coverage

Supplemental Medical Insurance