Restaurant Insurance

Restaurant owners and/or managers juggle a lot on their plates on a daily basis. They have to worry about how to boost sales, how to reduce costs, how to best manage their inventory, how to retain and motivate staff—the list goes on. As if that’s not enough, the kitchen itself is a dangerous place to work in. Accidents can happen at any time, and restaurants aren’t immune to them.

If you’re reading this, chances are you’re either a restaurant owner or a restaurant manager. While we can’t save your food from getting burnt, we can ensure that you won’t get blindsided by liabilities and lawsuits in the event of an accident.  This is where restaurant insurance comes in. Not only does having the right insurance give you peace of mind, but it can also save you from potential losses, medical fees, and legal claims.

Canada’s food service industry is currently worth $90 billion, but experts project this number to rise to $102.98 billion by 2027. The food and beverage industry is also the country’s 4th largest private-sector employee. With many businesses vying for the hearts of customers while trying to stay on top of costs, unforeseen costs and lawsuits are definitely not welcome additions to the equation. 

At KASE Insurance, we can help you get the necessary restaurant insurance in Ontario so that your business is always prepared for potential risks. While we take care of your insurance needs, you can focus your time and energy on what matters: doing what you love and growing your restaurant business.  

What Is Restaurant Insurance? 

As of 2022, there are about 78,650 restaurants in Canada with annual revenues ranging from $30,000 to $5,000,000. Though it is a competitive industry, these types of businesses bring in large revenues every year. Part of securing your restaurant’s revenue is to make sure your restaurant is properly protected by insurance. 

The standard restaurant insurance policy would give you enough coverage to protect you from common incidents that can lead to financial loss. These could range from a slip-and-fall accident within your establishment or property to a customer suffering from food poisoning. This can also provide security in instances when employees become injured or ill while at work and more.

There are also additional coverages that you can add to this basic package depending on the needs of your business. 

Why Is Restaurant Insurance So Important? 

Taking care of businesses that are related to the food and beverage industry is risky; it requires constant effort to ensure the safety of both your customers and employees. Otherwise, you expose your restaurant to legal claims or other liabilities. These situations could even lead to bankruptcy if you are not careful.

Risks in the Kitchen 

First of all, the kitchen, with its various tools and equipment, is filled with accidents waiting to happen. As a restaurant owner or manager, while you may have done all you could to make this establishment as safe as possible, there are plenty of unforeseen liabilities that can damage the property or even injure an employee or customer.

Food Safety 

There’s also the high possibility of food getting contaminated or expired food items getting served to unsuspecting customers. This situation is serious, especially since some instances of food poisoning—while extremely rare—can be fatal.

Traffic 

Due to the heavy foot traffic that a restaurant has, with people constantly coming and going, there are risks such as slips and falls within your restaurant’s premises that can happen. If you have delivery vehicles, any accidents that the vehicles get involved in can also be a potential liability. 

Not all restaurant businesses are the same, and there are different risks associated with each individual business. This is why a customized restaurant insurance policy is important. It will help to protect your business against costs from lawsuits and liabilities, thereby safeguarding your revenue and helping your business to survive and thrive. 

Standard Hospitality & Restaurant Insurance Coverage 

When it comes to restaurant insurance, it is never a one-size-fits-all solution. However, the basic insurance package for restaurants should encompass the following:

Commercial Property Insurance 

Property insurance covers your buildings, furniture, equipment, and other properties you have as a restaurant owner. If you are leasing your restaurant venue, chances are the owner of the building would have property insurance in case of damage to the property. However, this would not extend to the contents of the property, such as furniture or equipment that belong to your business—which is why it’s still useful to have property insurance.

General Liability Insurance 

This coverage protects your business in the event that somebody is injured within the premises of your restaurant. General liability insurance can also assist with copyright infringement lawsuits, reputation damage, and medical costs that arise from food illnesses. 

Workers’ Compensation Insurance 

This coverage protects your employees against work-related accidents or illnesses and lost wages. This commonly comes with employer’s liability insurance, which covers legal costs associated with a worker’s compensation lawsuit. 

Business Contents Insurance 

Business contents insurance protects equipment that’s left behind in an office or within your restaurant’s premises, which includes food stock or the company’s documents. 

Theft, vandalism, or other mishaps can happen at any given moment, and this type of policy helps protect your finances from losses or legal fees. 

Guests’ Property Insurance 

Guest’s property insurance protects you and your restaurant against losses borne from criminal activity and can be added to restaurant insurance in Ontario. 

For example, your restaurant is hosting a party when an uninvited guest shows up and causes trouble. If guests lose properties anywhere within the insured’s premises, this policy will essentially cover it. 

Additional Coverages for Restaurants & Hospitality Businesses 

Earlier, we talked about the basic coverages a restaurant insurance policy should have. Each of these parts represents different coverages: 

Liquor Liability 

Restaurants almost always offer alcoholic beverages to their customers. Liquor liability insurance protects your business against liabilities and costs related to incidents where an intoxicated customer injures themselves/someone else, damages property, or commits a crime.

Food Contamination Insurance 

This coverage is made to help a business recoup the costs of spoiled or contaminated food in case of a power outage or equipment breakdown.

Business Interruption Insurance 

Any interruption to your business will result in a loss of income. Business interruption insurance is a type of commercial insurance that can be added to restaurant insurance in Ontario. It replaces your income in the event of a natural disaster (such as a fire or flood) or direct physical loss or damage. This policy usually covers operating expenses, too, if necessary.

Umbrella Insurance 

Getting umbrella insurance provides an extra layer of protection for your restaurant. This type of policy complements your other insurance coverages by taking over costs that go beyond your original policy’s liability limits. Adding this insurance policy is worth it if you own a bigger business or if you have a significant amount of assets.

Cyber Insurance 

Important records, such as your restaurant’s books, your employees’ personal data or customers’ credit card information, could be subjected to cybersecurity attacks at any given moment. Cyber liability insurance added to restaurant insurance in Ontario offers you a level of protection against data breaches. This policy usually covers legal fees, repairs to damaged software or computer systems, and restoration of your customer’s personal information.

Equipment Breakdown Insurance 

Equipment breakdown insurance covers expenses caused by internal forces in your restaurant. This policy usually includes damages caused by power surges, electrical shorts, machinery breaking down, such as fridges or stoves, or operator errors. While it covers computers, it typically does not cover software restoration or replacement.

Commercial Automobile Liability Insurance 

This coverage is particularly useful if your restaurant owns delivery vehicles or vehicles used for catering events. This will protect you against medical, legal, or repair costs that are associated with a vehicular accident.

Peak Season Coverage 

When you’re in the hospitality business, there may be instances when you encounter peak seasons. So, to ensure your restaurant has enough inventory to keep your business going, you over-harvest vegetables and fruits or bulk-buy meat or other ingredients. When this happens, there’s always a risk that you won’t be able to use all the food in your stock. 

To combat the potential loss, peak season insurance added to restaurant insurance in Ontario helps protect your finances when you are at the height of the hospitality season. This amount can be lowered back down during other times of the year.

Who Needs Restaurant Insurance? 

There are various business types that fall under the category of F&B services. Most (if not all) businesses that serve food and drinks will benefit from securing a comprehensive restaurant insurance policy. Some of these business types can include the following:

• Bars/pubs/taverns
• Bakeries
• Cafes/coffee shops
• Delis
• Diners
• Food delivery services
• Quick service restaurants/fast food franchises
• Pizzerias
• Sandwich shops
• Tapas bars
• Lounges

Why Choose KASE Insurance? 

As one of the top providers of restaurant insurance in Ontario, KASE Insurance is your partner in ensuring the success of your business. With the right restaurant insurance policy in place, you will be able to have coverage for unforeseen events that can negatively impact your property, employees, customers, equipment, and so on. We can put together the best possible insurance policy for you based on the individual needs and risks associated with your business. 

Contact us today and let’s get started! With KASE Insurance, you’re in good hands.