Turning the vision of running your own restaurant into a reality can bring a lot of rewards, but it can also bring plenty of potential risks. In addition to looking after the health and safety of your customers, you also need to look after the health and safety of your business.
That's why it's so important to look into restaurant insurance and the local requirements to make sure you get set up with the right coverage from the start. And that's what our independent insurance agents are here for — to bring multiple quotes to the table, at a price you can feel good about, and a better understanding of how your policy works. From hot tamale buffets all the way to large-scale steakhouses, they'll get you covered. But first...
In short, restaurant insurance is a policy designed to cover all the components involved in your restaurant, from your property and supplies to your employees and customers. Obviously, serving food to the public ties directly into concerns about protecting their health, but restaurant operation comes with many different risks that are important to consider before setting up shop.
We'll get into specifics for the Copper State momentarily, but first, let's check out the type of coverage generally needed for restaurant owners across the board. A restaurant insurance policy typically includes the following:
The basics included in a restaurant insurance policy may not cover all of your specific needs. Your independent agent will know what add-ons to set you up with, but here's a look at a few that you might want to consider:
Dram shop laws hold a business liable for serving alcohol to minors, as well as for harm caused by an individual who has been overserved by that business — even after they leave your establishment. A state's specific laws and set of associated penalties/fines for violating them can influence your liquor liability coverage needs, and the cost of your coverage.
In Arizona, as well as most other states, a guest who sustains injuries to themselves due to overintoxication may not sue the establishment, since it's considered the guest's personal responsibility to monitor how much they consume. So, liability coverage for first-party cases is mainly only required in the case that a minor is served, since minors are not legally allowed to drink in any state.
However, third-party liability coverage is crucial. In the case that another individual is harmed by an intoxicated guest, such as in a bar fight or auto accident, they may sue your establishment. For these cases, the third party will need proof that the intoxicated guest continued to be intentionally served past the point of visible intoxication by your restaurant.
Lawsuits can seriously cost you or your business, in the form of significant financial penalties, loss of employment or liquor license, or even jail sentences. Your agent will set you up with the proper liquor liability coverage based on the Grand Canyon State's unique laws. They'll also explain the costs associated with each level of coverage.
Arizona's got its fair share of natural disasters. The state is most prone to wildfires and flash floods, so it's important to check your insurance coverage accordingly. You'll need to be sure that your property insurance component specifically mentions both wildfires and floods.
Have a chat with your agent about potentially adding coverage for wildfires and floods. It's best to just be prepared ahead of time, to avoid having to pay out of pocket for any damages later.
Dust and sand storms are referred to by Arizonans as "haboobs," and the state gets about three big ones (and many more smaller ones) per year. If these fierce storms happen often enough to earn themselves a goofy nickname, that means they're probably worth taking seriously as a potential threat to your restaurant.
While many homeowners policies in Arizona cover damage due to these common dust and sand storms, it's less clear whether your property insurance coverage under your restaurant insurance policy will include it. Talk to your agent about what your specific policy covers, and if you need to add more coverage — since no one likes a dusty restaurant.
It depends on what kind of restaurant you run and a few other factors, such as if you've got employees, offer a delivery service, operate a drive-thru, or serve liquor.
A typical range for coverage starts on the low end at about $10,000/year for a smaller establishment with fewer employees, and hits the high end at more than $100,000/year for a much larger restaurant, like a chain.
A restaurant insurance policy is typically the cheapest and easiest way to go. This package offers most of the liability and property coverage you'll need, and you can always add on specifics as necessary. Your independent insurance agent will know exactly what to hook you up with.
Obviously, smaller is going to be cheaper. A food truck or corner stand downtown will be by far the cheapest option, since there won't be as many sales as in a larger chain, there aren't any other employees (that would require workers' comp), and you won't be serving alcohol. Coverage costs would most likely be in the low thousands each year.
On the other end of the spectrum, a large dine-in chain restaurant with lots of employees, features like a salad bar and buffet, and a liquor bar is by far the priciest/riskiest venture. All the required workers' comp, property and liability insurance drive up costs exponentially.
It ultimately depends on lots of specifics like the number of employees and the value of the property, of course, but we're talking BIG numbers, like more than $100,000 per year.
Insurance policies are often filled with lots of technical jargon. Additionally, it's a real process to hunt for the RIGHT policy. Fortunately, sifting through the available options and pinpointing the necessary coverage is a task that can easily be handed off to someone else. That's where independent insurance agents come in to save the day.
Independent insurance agents will not only help you get the best possible deal, but also the type of coverage that's right for you. They shop and compare insurance quotes for you, and even break down all that complex jargon into plain old English, so you understand exactly what you're getting.
Our wise and helpful agents will help you determine which types of coverage make the most sense for YOU. They'll also compare policies and quotes from several different insurance companies to make sure they're setting you up with protection that's among the best around. In other words, they'll make it happen.