Is It Time to Reevaluate Your Restaurant or Bar Insurance?

The world looked very different one year ago. Just weeks into the COVID-19 pandemic with more questions than answers, every industry was trying to figure out just how to move forward while still remaining safe, and keeping their staff and customers safe as well. One thing is for sure, those in the restaurant industry are well-poised for resiliency in the face of challenge — and they have overcome some real hurdles in the past year.

In fact, by this time last year, new procedures and business models were already taking flight. Restaurants that could quickly evolved to offer take out and curbside service and delivery options — and to-go cocktails became part of those offerings. But now as the cloud of COVID is starting to lift and things are going back to normal, it’s important to assess whether those things are actually covered on a restaurateur’s insurance plan. This is a very good time for business owners to review their insurance policies, as a lot has changed in the past year that could impact their plan. 

While restaurateurs and business owners have learned some incredible business lessons as a result of COVID, it’s fair to say no one wants to go down that road again. It’s also understandable that many may have that fear in the back of their minds. While there is no real policy that covers an unforeseen virus, restaurant owners can be as covered as possible in other areas to best protect themselves for future instances. 

Also in relation to COVID, policies should be reviewed, as many are based on the amount made in sales. With closures and limited service and seating, most restaurants’ incomes are likely dramatically different than they were in February of last year before mandated closures and capacity restrictions. Reviewing current sales can help restaurant owners better reflect numbers to date, which can save them some money on their insurance. 

Policy endorsements should also be reviewed and updated. Just like those aforementioned “pivots” like take-out or delivery options and to-go liquor sales, there have been a lot of new implementations in the past year that may or may not be currently covered on one’s insurance plan. In particular, there was a lot of elbow room when it came to to-go liquor sales amid the pandemic in the state of Arizona, but restaurants may not actually be covered for those sales.

Another trend born out of the pandemic is the increased demand for delivery service, and restaurants took to partnering with third-party services such as Uber Eats and Grubhub to help them fulfill those deliveries. It’s important that restaurateurs have contracts with these partners and that those contracts clearly state the responsibility of each party.

For new restaurateurs that are looking to open their doors, it’s advantageous to have an expert look at any property leases. And any business owner in the bar and restaurant industry should ensure they are well covered for the everyday necessities of running a business. That includes everything from inventory to employment practices like hiring (or not hiring!) and firing.

Now that the pandemic is seemingly better under control, the restaurant industry is starting to come back to life! With COVID in the rear view, restaurateurs can look ahead to the future with that same reliance that kept them afloat over the past year… and some air-tight insurance policies, of course.