No two restaurants are alike. As such, each faces its own set of risks. With the food industry facing countless claims every year, it’s your job as a restaurant owner to be aware of the liability exposures facing your business and take preventative measures to ensure that in the event of a claim, your business will be up and running as quickly as possible. Below, we’ve outlined three common claims restaurants deal with on a daily basis to help you get started.
Fire
A major hazard associated with a restaurant is cooking. Grease vapour produced from cooking can accumulate throughout the kitchen and cause a high exposure for fire. Further, cooking surfaces such as grills and deep fryers can contribute to the spread of fire and how easily in can engulf a restaurant kitchen.
What to do: If you don’t have property insurance already, get coverage immediately. Have an automatic fire extinguishing protection system on hand that includes hood and filter systems. Check your fuel shut offs for your grills and deep fryers and make sure they’re easily accessible and tagged. Also check to ensure handheld fire extinguishers are conveniently located throughout the kitchen.
Theft
As a restaurant owner, you’re running a cash-heavy business. You may also carry expensive cuts of meat and bottles of alcohol in your inventory. If you’re a fine dining establishment, you may have other costly inventory, such as works of art, collectibles and memorabilia making your restaurant a prime target for criminals.
What to do: You can protect your cash, expensive inventory and valuables with property insurance coverage. With property insurance, you’ll be covered for theft of inventory (food and alcohol), computer equipment, furniture and fixtures, as well as cash. If anything happens to the goods while they are being transported, inland marine will cover the cost of replacing the goods. Enhanced wine valuation coverage is another coverage you’ll want to get to protect your valuable wine collection.
Food poisoning
An inoperative or damaged fridge or freezer presents the risk of food contamination, which can lead to food poisoning – one of the greatest risks facing the food industry. When a customer claims food poisoning post eating at your restaurant and sues your business, you want to be prepared with the necessary food liability coverage. Typical commercial general liability (CGL) insurance policies usually exclude this coverage.
What to do: Obtain food contamination coverage, which covers you in the event of a food-related loss. This type of coverage typically extends to loss of income, required cleaning of equipment, and food replacement costs from contamination in the event a food inspection is required.
