Running a restaurant or bar is one of the profitable businesses in today’s times.
However, it can’t be denied that the risks are quite different and high in this industry. For example, you never know when a nice cake served by you causes food poisoning. Or what if your waiter spills hot coffee accidentally on a customer? For a bar, the risk gets manifold due to the customers under the influence of alcohol. Injured customers by your business operations or at your premises can sue you for compensation. On top of that, many things like water damage, fire breakout, or relocation can interrupt your business.
That’s why a food serving business should have the right insurance in place to get protection from such risks. There are a variety of insurance covers that help you protect your money if something goes wrong.
Here we have listed such important insurances for restaurants, cafes, and bars in Australia.
Public Liability Insurance:
Counted among one of the important insurances, Public Liability Insurance Australia can protect against the claim or lawsuit arising from injuries or damages caused by your business operations. This is an important insurance for restaurants as their premises are visited by a lot of people every day.
No matter how careful you or your staff is there will be occasions when someone can sustain an injury. For example, a customer can slip on the wet floor, causing injury to them. Spilled hot drinks and food are lurking dangers that could cause grave injury and burn, leading to a costly claim.
When this occurs, public liability insurance protects your restaurant or bar against forking out a lot of money for compensation or defending the case in the court.
Commercial Property Insurance:
Commercial property insurance also termed as business property or commercial building insurance cover the business against damage or loss of their business equipment and the property itself. It protects the restaurants from heavy losses due to fire, theft, vandalism, or sudden disaster.
For a restaurant or bar, this includes the kitchen equipment, registers, furniture, cutlery, or everything being owned by them. It ensures protection against all the common risks a restaurant or bar faces such as fire, water damage (in some cases), and theft.
Business Interruption Insurance:
Many things can bring your restaurants to a standstill. They might be fire breakdown, water damage, relocation, or theft. It is not easy for you to continue your venture until the issues are fixed. But you have to pay rent and wages despite the situation.
Business interruption insurance is important in such scenarios. It helps you keep your business up and running. Also termed as business continuity insurance or business revenue insurance, this insurance pays for the losses due to the interrupted operations. Some insurance plans might cover wages for employers, staff, and well as ongoing expenses such as rent.
The cost of business interruption insurance is determined by the size and type of your restaurant, cafe, or bar.
Product Liability Insurance:
What if the customer experience food poisoning after taking the cold coffee served by your cafe? Or what if the cheese was found stale?
A victim has every right to sue your business for compensation, no matter if you are innocent or it happened accidentally.
This is where product liability insurance comes in. It protects your food or drinks service establishment from lawsuits or claims arising from food-borne illnesses caused by the food or drink served by you. Generally, it is included in public liability insurance.
Make sure to know the definition of a “product” in your insurance policy. It is generally used for something that is erected, installed, grown, extracted, produced, processed, treated, repaired, serviced, bottled, handled, sold, supplied, or exported by your business or someone on your behalf.
Management Liability Cover:
As your foodservice business scales up, you might start to hire more staff to deal with the extra load, exposing you to a new range of risks associated with running a business. Management Liability can protect your business from the perils and exposures associated with operating a business.
It can protect the following areas:
- Employee Dishonesty: Theft of crime done by workers including theft of money.
- Employment Practices Liability: Covering against allegations of bullying, harassment, discrimination, and unfair dismissal.
- Disposal of waste and garbage: Protecting against the fines associated with incorrect disposal of waste.
Most restaurants, coffee shops, and bars keep a staff that is comprised of waiters, cleaners, bartenders, chefs, and receptionists. That’s why you need workers’ compensation insurance.
It covers the medical cost if your employee gets injured or sick on the work. For example, they can slip on a wet floor or getting cut by broken glass, requiring immediate medical aid. And this insurance is compulsory throughout Australia.
So you must have understood the important insurance types for your restaurant, cafes, and bars in Australia. Opting for the right insurance protects you from costly claims occurred by the damages or injuries caused by your business operation, site, or product.