As popular establishments for socialization, bars are often bustling with activity, which is a significant cause of chaos and accidents. Statistics show that over half of US fatal accidents happen at night, with over 50% of those being alcohol-related.
These establishments also face operational risks, such as equipment breakdown and food spoilage, which are grounds for lawsuits.
Bar operators should work with trusted bar insurance providers to obtain coverage to shield their businesses from these liabilities.
Below is an overview of bar insurance coverage options and factors to consider when choosing a provider.
What Insurance Coverage Does a Bar Need?
There are several reasons why a bar would need insurance. These include:
- Liability coverage: Bars can be held liable for accidents and injuries on their premises. These include slip-and-fall accidents, fights, or other incidents resulting in bodily harm to patronage or employees.
- Liquor liability claims: Most bars serve alcohol. Such establishments may be held responsible for the actions of patrons who drink in excess and cause damage to other people or property while in or after leaving the premises.
- Property damage: Like other business premises, bars are prone to theft, vandalism, fire, and natural disasters.
- Business interruption: Equipment breakdown, power outages, and food spoilage, among other unforeseen events, can disrupt business operations and lead to financial loss.
- Workers’ compensation: Bar employees risk injuries related to their job duties, which would hold the establishment liable for medical costs and lost wages.
What Is Covered By Bar Insurance?
Bar insurance providers offer a range of coverage options to address the risks and liabilities mentioned above. These may include:
- General liability insurance for accidents and mishaps on the premises
- Assault and battery insurance for claims related to fights and altercations on the premises
- Property insurance covers damage to the premises, equipment, or inventory and property belonging to patrons, employees, and other third parties but under the bar’s care.
- Liquor liability insurance
- Equipment breakdown insurance
- Auto insurance
- Food spoilage insurance
- Workers’ compensation insurance
What to Consider When Choosing a Bar Insurance Provider
Finding the right bar insurance provider is essential in ensuring adequate coverage for your establishment. Here are a few factors to consider when making this decision:
Reputation
The insurance industry is littered with unscrupulous providers who thrive on exploiting unsuspecting proprietors. As a bar owner or operator, you’ll want your insurance provider to have a good track record in underwriting comprehensive insurance policies and handling claims.
Coverage Options and Limits
Policy coverage is one of the most ambiguous and complicated aspects of insurance contracts, as these agreements often contain exclusions, limitations, and conditions.
As such, bar owners should pay close attention to the provider’s policy offerings, including terms, limits, and exclusions, to ensure they provide adequate coverage for their unique needs.
Experience in the Bar and Hospitality Industry
Insurance providers offer expert guidance and consultation on risk management. Seasoned providers deeply understand industry challenges and risks and are better positioned to help their clients.
Their offerings are tailored to meet the challenges bar owners and operators face.
Premiums and Deductibles
Policyholders take out insurance to restore their businesses to the same financial state and operations as before a loss under the principle of indemnity.
It is beneficial that bar owners compare the cost of insurance from different providers and the deductibles they offer. They should also assess costs versus coverage to ensure they get a fair deal.
Financial Stability
Every policyholder’s nightmare is seeing their insurer become insolvent in a time of need. As such, bar owners must ensure their insurance providers have strong financial backing, enabling them to meet their obligations if called upon.
Bar owners can check the credit ratings of various providers through AM Best, S&P Global Ratings, and Moody’s Ratings, among other rating agencies.
Credentials and Qualifications
Bar owners must ensure their insurance providers are duly registered and licensed to provide insurance services in their state of operation. They should also check for designations that demonstrate a high level of expertise, such as:
- Chartered Property and Casualty Underwriter (CPCU)
- Certified Insurance Counselor (CIC)
- Associate in Risk Management (ARM)
Customer Service
Insurance providers are known for their slow response to claims, as opposed to their aggressive marketing. Bar owners should research the quality of customer support provided by various providers, which is integral in choosing policies. They should also assess their claims processing and settlement track record.
Find Your Next Bar Insurance Provider with Pro Insurance Group
Pro Insurance Group’s seasoned insurance agents and advisors understand what it takes to run a successful bar business. Bar insurance carrier options at Pro Insurance Group are customized to cover day-to-day operational risks and match constraint budgets.
Contact the team today for expert advice on risk management and comprehensive bar insurance coverage.