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Business Insurance for Restaurants

What insurance do I need for a restaurant?

Alicia Hempsted
Written by  Alicia Hempsted
4 min read
Updated: 04 Apr 2024

In our guide, we’ll outline all the different types of insurance you can take out to protect your restaurant and help you find a policy that’s right for your business.

What is restaurant insurance? 

Restaurant insurance is a bundle of business insurance products that are designed to protect your business from a range of potential risks. 

Usually you will have public liability insurance or employers’ liability insurance at the heart of this package with a number of extra cover options to choose from to tailor your protection.

Friends eating at restaurant

What does restaurant insurance cover?

  • Public liability insurance: Covers legal fees and compensation payments if a member of the public claims your business is liable for an accidental injury, illness, death, or property damage 

  • Product liability insurance: Covers legal fees and compensation payments if a consumer claims that a product you sold to them is responsible for injury, illness, death, or property damage 

  • Employers’ liability insurance: Covers legal fees and compensation if an employee falls ill, is injured, or has their property damaged at work 

  • Business contents insurance: Covers repairs and replacement of the contents of your restaurant if they are damaged or loss as a result of fire, theft, flooding, or storms 

  • Business building / tenants improvements insurance: Covers repairs to the restaurant building or structural changes you made if they are damaged by a fire, flood, storm, or a burglary 

  • Business interruption insurance: Supplements your business’s lost income if an unforeseen event prevents you from operating as usual, such as a flood preventing customers from accessing the restaurant 

  • Stock insurance: Covers the cost of replacing your restaurant’s stock if it is damaged or lost in an insured event, such as a fire or flood 

What extra cover can I add to restaurant insurance?

To give you even greater protection for your restaurant, some providers will offer additional cover options you can add to your policy. The most popular of these are: 

  • Legal expenses cover: Covers certain legal expenses related to your business, such as contract disputes, business taxes, and corporate identity theft 

  • Personal accident cover: Covers people insured for accident-related injury, disability, or death, whether the accident happens at work or not 

  • Rent payable cover: Covers rent payments you may need to pay while your business has been paused by an insured event, such as a flood or fire 

Do I need restaurant insurance?

Restaurant insurance isn’t a legal requirement with the exception of employers’ liability insurance, which is a legal requirement in the UK if you are an employer. This applies to businesses with full-time or part-time employers, contractors, and even volunteers. 

Other types of business insurance aren’t a requirement to run a restaurant business, but they serve a very valuable purpose of protecting your business. Public liability insurance in particular is highly recommended for most businesses to cover expensive legal fees and compensation payments.  

How much is restaurant insurance?

The cost of restaurant insurance isn’t the same for every business. It will depend mostly on the specifications of your business and the cover you need. Here are a few details that will affect the cost of your insurance: 

  • Your business’s annual turnover 

  • The number of people employed by your business 

  • The rebuild value of your business and value of your business contents 

  • The insurance products and cover types you add to your policy 

  • The level of cover you choose 

Tips for taking out restaurant insurance 

To get the most out of your restaurant insurance, here are a few things for your to keep in mind when you take out your policy: 

Keep an eye on the cost of repairs and replacements 

When taking out business buildings or contents insurance, you should regularly reassess the value of your business contents and check your rebuild value.  

The cost of rebuilding or replacing the contents of your business can be changed by inflation or changes to your building or equipment. If you don’t keep this in mind, you may find that your insurance cover isn’t enough to cover your expenses if you need to make a claim. 

When the time comes to renew your policy, it’s worthwhile to check that your cover is enough to protect your business if the worst should happen. 

Check that your stock is covered 

While many business contents insurance policies will cover stock, not all of them do. So much of a restaurant’s budget is invested in stocking their kitchen and bar, and losing your inventory in a fire or flood means a complete halt in operations until everything can be replaced.  

When you’re calculating how much it will cost to replace your stock, you should look at the trade value, not the retail value. You should also keep an eye on any seasonal changes to your inventory, such an increase of your supply of alcoholic drinks around Christmas and New Year. 

Consider adding cash cover if it isn’t included 

Not every business contents insurance policy will cover cash and important documents that are kept in your restaurant.  

If your restaurant accepts cash payments or often keeps money on the premises, this is an important cover to keep an eye out for. If your provider offers protection of money as an optional cover, then for an extra fee you can add it to your policy. 

If your policy does offer money cover, then you will need to pay close attention to the conditions of this cover. Some policies require money to be removed from the property outside of business hours our for it to be kept in a safe. 

You should always read your policy documents carefully to find out the terms of your insurance coverage. 

Find a great deal on restaurant insurance 

The easiest way to find a great deal on restaurant insurance is to compare quotes online. When you compare quotes with MoneySuperMarket, we’ll show you all of your available cover options for you to pick and choose and show you competitive insurance quotes for your restaurant.  

You can compare price and cover all in one place so you can get the best deal for the business protection you need.  

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