Modern restaurants accommodate a wide range of special events, from wedding receptions and wine tastings to cooking classes and charity functions. As a restaurant owner, it is important to consider all risks associated with hosting these types of events and how you can protect your investment. Special event insurance is an effective way to prevent financial losses associated with unforeseen circumstances out of your control.
Assessing Special Event Insurance Policies
How much does special event insurance cost? Well, this can range based on the number of policies acquired, the liabilities linked to the special event, and the value of the property in which the event is being held.
1. General Liability Insurance
General liability insurance is a broad type of coverage that can protect your restaurant from claims of property damage, bodily injury, personal injury, and similar damages that can result from business operations. While exact benefits can differ depending on your unique policy terms, most general liability policies will cover medical payments resulting from any accidents that occur on your premises, regardless of who is at fault. For example, general liability insurance would kick in if a guest at your special event slipped and fell on a wet floor, resulting in injuries.
2. Liquor Liability Insurance
If you have a restaurant that sells or serves alcohol, having liquor liability insurance for your special event is a must. Liquor liability insurance provides restaurant owners with coverage for bodily injury or property damage caused by an intoxicated patron who was served or sold alcohol by the policyholder. The injury does not necessarily need to happen at the event for the policyholder to be eligible for liquor liability benefits. For example, your policy may cover any damages if an intoxicated patron drinks at your event and drives, causing a vehicle accident that injures another person or causes property damage.
3. Inland Marine Insurance
Inland marine insurance is a type of property insurance that is used to cover movable property and certain specialized items not covered under a standard property insurance policy. Restaurant owners can use inland marine insurance to cover a wide range of items, such as catering equipment for a special event. With this type of insurance policy, you can gain coverage for property in transit, portable property that remains in a fixed location, and property in your temporary care. Inland marine insurance can be written as an all-risk policy, which typically covers all types of perils, or a named-peril policy which only covers the perils that are detailed in the policy.
4. Assault & Battery Insurance
All businesses in the hospitality industry can benefit from having an assault and battery insurance policy. This is especially true if your restaurant serves alcoholic beverages. Assault refers to any threatening act, whether verbal or physical, that causes a person a reasonable amount of fear for their safety. Battery is the unlawful application of force to another person. If you operate a restaurant, there is always a risk of an altercation occurring between two or more people. Assault and battery insurance provide coverage for fights, shootings, stabbings, hit-and-runs, and cases of attempted robbery.
Risks & Liabilities that Affect Insurance Pricing
Pricing for special event insurance can greatly range depending on a number of factors. When providing a quote for insurance policies, a lender will typically look at the amount of risk and liability that your business faces. If your business is considered high-risk, you are likely going to pay more for special event insurance. The most common risks associated with special events include property damage, personal injury, theft, fraud, and cancellation due to the nonappearance of a featured performer or from inclement weather.
The losses associated with these types of events can be devastating depending on how much you have invested in the event. For example, if you have to cancel your event at the last minute you may be responsible for providing refunds to customers and paying for any permit fees and lost security deposits. If you experience a problem with a particular vendor, you might have to pay a significant amount more for a replacement. Personal injury is also a major concern that can result in tens of thousands of dollars in medical bills and lost wages. If someone is injured at your event, you may be looking at a massive lawsuit.
Speak To An Entertainment Insurance Broker
Many restaurants host events like conferences and receptions. Unfortunately, these types of events leave a business susceptible to legal claims. To protect all that you have worked so hard for, it is crucial to have the proper insurance policies. For more information about special event insurance cost or to learn how you can acquire a special event insurance policy for your restaurant, contact the entertainment brokers at MFE Insurance today.