Keeping Rising Restaurant Insurance Costs Down
Rising insurance premiums are just one of the challenges the hospitality industry has had to deal with during the pandemic. A Canadian Federation of Independent Business study found that 25% of hospitality businesses have experienced an increase in insurance premiums of 25% or more.
According to Insurance Business Canada, 9% of businesses were unable to find an insurer to cover their business and “14% of hospitality businesses…said they were unable to secure coverage in the past year.”
Live music venues, bars, and nightclubs were having an especially difficult time finding affordable insurance, a problem that was compounded by having been shut down and for most of the pandemic.
Mark von Schellwitz, western region vice president of Restaurants Canada pointed out that “...of course, that’s really difficult with the pandemic restrictions still in place to even generate pre-COVID revenue, never-mind the extra revenue that they’re going to have to generate to pay for these increased costs.”
More claims mean higher premiums
According to the Insurance Bureau of Canada (IBC), the increase in restaurant insurance premiums is partly due to more frequent lawsuits and higher payouts. There was a 108% increase in Commercial liability claims between 2013 and 2020.
IBC president Aaron Sutherland said that there is a trend of claims by people who are injured or caught driving while intoxicated against the establishment or person who served them alcohol. “When someone becomes intoxicated at their business, they’re being held liable for that and for any injuries — or at least a portion of any injuries — that intoxicated individual then gets into.”
Tips for keeping your restaurant insurance premiums low
There are a few things you can do to make your restaurant insurance more affordable.
Keep walkways clear
Reduce the risk of customers falling by keeping areas where customers walk uncluttered and removing tripping hazards. In the winter, make sure outdoor areas are shoveled and sprinkled with salt or gravel. Put wet floor signs up when the floors are being mopped.
Fire safety
Have fire extinguishers near cooking areas and clean them at least every six months. Cleaning the C02 ducts decreases your fire risk and chances of having to make a claim.
Hide your cash
Minimize the risk of theft by Emptying the till every day and keeping cash in a safe or other secure area hidden from view. Electronics should also be stored out of sight.
Shop around
Taking some time to research different options can pay off and your insurance broker can help. Chris Hewitt, the owner of Dickens Pub in Calgary, received a quote 600% higher than usual but was eventually able to get insurance that was 60% higher.
Sweep and Salt Logs
Maintaining a sweep and salt log ensures that the premises is kept clean and safe for customers entering, exiting, and navigating the premises. By ensuring sound risk management practices, a documented log allows additional layer of protection by having regular checks completed and recorded in-case and accident were to occur.
