(Photo | Courtesy of Country Financial)
Operating a restaurant is no easy task and owners have had their struggles the past couple of years. It takes a lot of work to open and grow your business and consistently provide your customers with exceptional food and service. If something unexpected were to happen to your restaurant or food truck such as a fire, or mechanical breakdown, it could derail everything.
Working closely with local business owners over the years I’ve had many conversations about the scenarios that could put a small business at risk. Below, I highlight some of the main coverages restaurants should be aware of to ensure they are protected from common losses.
Business income coverage: This protects you from a loss of income if your business closes due to a covered loss such as a fire, theft or a disaster event. For example, if a fire caused damage to a restaurant and its cooking equipment causing it to shut down, business income coverage would cover the loss of income the restaurant would have earned during the period it takes to get back up and running.
Equipment breakdown: If your restaurant experiences an equipment breakdown that leads to financial loss, this coverage will cover that loss and the expense to replace or repair it, up to the building and personal property limit.
Spoilage: If your refrigerator or freezer breaks down or there’s a power outage, you’re at risk of loosing all of your perishable stock and worse, potentially serving customers contaminated food. Spoilage coverage can cover the cost to replace the spoiled food so that you don’t feel bad tossing it out.
Liquor Liability: This coverage provides protection against damages or legal fees incurred from injury of selling, serving or furnishing alcoholic beverages. Some states require bars and restaurants that sell alcohol to have coverage limit. In Oregon, the requirement is to have coverage of at least $300,000.
Workers Compensation: If any of your staff is injured at the workplace, whether it’s a slip and fall or burn, you could be liable. Workers compensation insurance can provide protection from lawsuits from injured employees and help cover medical expenses, disability income and rehabilitation benefits.
Data Breach: The pandemic caused restaurants to move more of their activity online and even offer new products and services over the web. With that, more customer information moved online, creating greater exposure for risk. Data breach coverage can cover the expense of data breach response, liability and legal fees should a breach occur.
These are just a few examples of coverage restaurant owners should be informed about. Whether you own a food truck or a chain of sub shops, each business has inherently different risks and coverage needs. The best approach is to sit down with a qualified insurance representative who is experienced in working with small businesses to discuss what is right for you.
Meryl Langley is a financial representative with COUNTRY Financial in Bend. She can be reached at Meryl.Langley@countryfinancial.com or 541-388-9016 with questions.
Business insurance policies issued by COUNTRY Mutual Insurance Company, Bloomington, Illinois.
