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What should you look for when choosing insurance?

Premiums, exclusions, jargony terms and fine print–it’s enough to set your head spinning. We know that looking for the right insurance for your restaurant can be tough. And with so many insurance products, bundles, companies, and agents out there vying for your attention, it can feel like you’re simply at the mercy of the industry. It’s time that narrative changed. 

Insurance Basics

Like any insurance plan, a strong restaurant policy is all about protection against risk. Of course to really know what your specific risks are, you’ll need to get down to details. You’ll also need a good working relationship with an agent you can trust, who’s proven that they know their stuff and that they understand your industry. But beyond a top-notch insurance agent, what else should you look for when navigating through the insurance world? 

Your insurance journey begins with two words: 1) identify, and 2) understand. First off, you’ll want to have a good handle on the specific risks that your restaurant could face–these can run the gamut. Take time to walk through your restaurant space and daily operations and find the weak spots. Once that’s done, you’ll need to understand what sorts of policies are out there and how your set of circumstances could affect pricing. There are plenty of solid resources out there that can define terms and explain how it all works. Feel free to take notes and compare. Or if you’re more comfortable having a trusted agent translate, that’s always an option too. 

Uncovering Exclusions

Now that you’re aware of what you need from an insurance policy, it’s a good time to ask about exclusions. A Business Owners Policy (BOP) is a solid foundation for every business out there, but it may not cover every scenario that could arise. For example:  

  • an intoxicated patron starts a fight that results in a third party’s property damage and injury–your General Liability coverage won’t pay if they sue
  • you lose an entire fridge of food due to a power outage caused by a malfunction at the power station–your Property coverage won’t pay to replace it
  • your restaurant’s sign is vandalized and windows are broken–your Property coverage doesn’t pay to have it repaired
  • the company vehicle is involved in an auto accident–neither your personal auto nor the company’s General Liability coverage will pay for damages 

These are just a few situations in which exclusions apply and a standard BOP likely won’t cover a loss. This is serious business and it’s good to be in the know, so ask your agent the hard questions when deciding on an insurance plan. 

Exacting Replacements

Another key consideration to look for in a Commercial Property Policy is a provision that will cover the full replacement cost of your loss. Many policies will only cover property at the “Actual Current Value”–not what you paid for it, but what it’s worth today. If a property policy only covers the current value, you could be paying a good deal out of pocket if you need to replace damaged property–think equipment, furniture, kitchen tools, electronics, etc. It pays to know what to expect when replacing business property. 

Coverage over Cost

In the end, the goal is to start with the basics and then tweak to fit your own personal needs. The best insurance policy is more like a ‘to taste’ recipe than it is a pre-packaged meal. The element of choice and the ability to customize should always be available. “Custom” could sound more like “expensive,” but this is one area in which price can’t determine the best coverage. Whether it’s more or less than you anticipated, the bottom-line goal is coverage from every angle. 

Insurance Takeaways

If we could sum up this topic in two words, it would be these two: don’t assume. Ask questions, investigate, and be ready to get into the nitty gritty of insurance. Of course, once you have the perfect policy in place, you might end up forgetting all those important details. That’s why it’s a good idea for a yearly assessment. This annual chat with your agent will ensure that any new risks are accounted for, and any adjustments are made. That’s how you’ll make sure that you’re always protected against life’s mishaps. 

Finding an agent that understands the niche considerations of your specific industry will go far to get you on the right insurance track. Start a relationship today–get in touch with Pronto and learn how relatable restaurant insurance can be. 

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