Restaurant insurance helps protect the premises, fit-out, equipment, stock and the financial interests of the business against events expressly specified in the contract. A programme may also include liability to guests and business interruption.
Contents
  1. What can be insured
  2. Main risks
  3. Types of cover
  4. Policy cost
  5. Preparing for insurance
  6. What to do when an incident occurs

What can be insured in a restaurant

A restaurant combines real estate, building services, expensive technological equipment, furniture, inventory and liability to a large number of guests. The insurance programme is built according to whether the premises are owned by the company or leased.

  • the building or premises, if the policyholder has an insurable interest;
  • interior finishes, partitions and display windows;
  • kitchen, refrigeration and ventilation equipment;
  • furniture, tableware, cash registers and interior elements;
  • food, beverages and other stock;
  • exterior signs and advertising structures;
  • civil liability to third parties;
  • financial losses caused by business interruption.

Each item must be described with sufficient precision. For leased premises, it is determined separately what the owner insures and what the tenant insures. Improvements made by the tenant, equipment and liability under the lease require a separate check.

Which risks may be included

Risk Possible consequences What to check
Fire and explosion Damage to the kitchen, dining room, fit-out and stock Fire safety requirements and equipment maintenance
Water damage Leaks, water supply and heating failures Wear-and-tear exclusions and maintenance obligations
Unlawful acts Burglary, robbery, vandalism Security, alarm system and signs of forced entry
Natural events Damage to the building, signs and equipment The list of events and territory of cover
Glass breakage Display windows, mirrors and decorative elements Special limit and replacement cost
Liability Harm to the life, health or property of a guest Limit, deductible and exclusions for product quality
Important: the name of a risk does not guarantee cover for all causes of loss. For example, water damage from a sudden failure may be covered, while a long-term leak, corrosion or improper maintenance may be excluded.

Main parts of the insurance programme

Property insurance

Protects tangible assets up to the sum insured. The valuation basis must be determined: replacement value, actual value or another value. An insufficient sum insured may lead to a proportional reduction of the payout, if the contract provides for such a condition.

Liability to guests

May apply to documented harm for which the restaurant is liable. Check whether the cloakroom, delivery, events, the summer terrace and harm related to food are included.

Business interruption

The cover may compensate agreed fixed costs and lost profit if the stoppage of the business results from an insured property event. The indemnity period, the time deductible, the calculation method and the financial documents are important.

Equipment breakdown and spoilage of stock

Standard property cover does not always include internal breakdown of equipment or the spoilage of food due to temperature changes. Special terms may be required for refrigeration equipment, boilers and ventilation.

What determines the cost of insurance

  • the area, construction and age of the building;
  • the value of the fit-out, equipment and stock;
  • the presence of open flame, gas and heating equipment;
  • the condition of the electrical, water supply and ventilation systems;
  • fire alarm, security and video surveillance systems;
  • loss history and previous claims;
  • the selected risks, limits and deductibles;
  • the presence of delivery, events and a summer terrace.

Saving money by understating the value of property is risky. Before the quote, it is useful to compile a register of assets with purchase dates, values and documents. For unique fit-outs and imported equipment, allow for the real timeframe and cost of reinstatement.

How to prepare for arranging cover

  1. Gather the documents for the premises and the lease agreement.
  2. Prepare a list of equipment, furniture and stock.
  3. Describe the technological processes and the fuel used.
  4. State the security systems and maintenance contracts.
  5. Disclose past incidents and claims.
  6. Determine the desired limits for property and liability.
  7. Study the exclusions, the deductible and the obligations to prevent loss.
  8. Agree the procedure for changing the list of property during the year.

The insurer may request an inspection and photographs. The questionnaire must reflect the actual condition of the site. Reconfiguration of the premises, new equipment or a change in the type of activity can change the risk, so material changes must be reported.

What to do when an insured event occurs

  1. Ensure the safety of people and stop the loss from spreading, if this can be done without risk.
  2. Call the emergency services, the police, the utilities emergency service or the building management company.
  3. Notify the insurer within the time set by the contract.
  4. Photograph the scene, the property and the source of the damage.
  5. Do not throw away damaged items before inspection without agreement.
  6. Draw up a list of lost property and collect documents showing its value.
  7. Keep reports, invoices, receipts and correspondence.

Emergency measures needed to save lives and reduce loss should not be delayed. At the same time, it is important to record the condition of the site. Before admitting claims from guests or neighbours, check the terms of the liability policy and notify the insurer.

Documents for claim settlement

  • an application and details of the insurance contract;
  • reports from the competent services on the causes and circumstances;
  • documents for the property and proof of insurable interest;
  • a register of damage, photographs and video recordings;
  • invoices, delivery notes and reinstatement estimates;
  • third-party claims and proof of the amount of harm;
  • financial documents, if a business interruption claim is made.

Conclusion

Restaurant property insurance is effective when the programme takes into account the real value of assets, technological features, liability and possible business interruption. The policy should be combined with fire safety, technical maintenance and internal instructions.

This material is for information purposes only. The exact risks, exclusions and payouts are determined by the contract with a licensed insurance company.