Everything You Need to Know about Restaurant Insurance in New Hampshire
(Because this state sets its standards at "the BEST")
Christine Lacagnina |February 24, 2019
You've been dreaming up the perfect menu for your New Hampshire restaurant, and you've already got visions of lobster rolls running on repeat. But whether you're planning to serve up the local cuisine or open up the next great pizza chain, sadly restaurant ownership comes with some risks, too . . . like potential lawsuits. It's important to get the right coverage in place before you fire up those burners. Which is why we're here — to give you a breakdown on restaurant insurance in your state.
We'll start with the basics of just what the heck restaurant insurance even is, and then narrow the focus down to New Hampshire's specific state requirements. And when you're feeling good and ready, our independent insurance agents are here to help you find the protection you deserve and need. So prepare your taste buds and we'll dig right in.
What Is Restaurant Insurance?
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.
What Type of Restaurant Insurance Do I Need in New Hampshire?
Before we check out New Hampshire's unique requirements, we'll start with the coverage needed by restaurant owners across the board. A typical restaurant insurance policy usually includes the following:
General liability: This coverage protects against lawsuits related to injury or property damage done by the business, and it's mandatory. Food poisoning claims would fall under this category.
Workers' compensation: If your employees become ill, get injured or die from a work-related incident, this aspect of the insurance will cover the financial ramifications. Coverage is mandatory in New Hampshire, as well as in most other states.
Property insurance: This covers any damage to the physical building that houses your restaurant, in case of fire, etc. The type of cooking equipment your establishment uses will contribute to the risk of fire damage, and may influence the cost of your policy. Businesses with deep fryers that use grease, for example, are considered a higher risk. Note: Restaurants with a drive-thru will have extra property that needs coverage, and paved surfaces (like driveways) are not typically covered by general property insurance.
Business income: A part of property insurance, this aspect covers the financial loss suffered while a business is closed due to fire damage or other disasters.
Ordinance and law: Another part of property insurance, it covers the financial ramifications if your building is found to not be up to current state code. This coverage also applies in the event that you need to rebuild your restaurant, or if you're building one from the ground up, yourself. Handicap compliant features, fire safety equipment, and emergency exits are all factors, here.
Boiler & machinery: Also known as "equipment insurance," it covers electric equipment in the building (e.g., AC units and boilers) that breaks down due to power surges, etc. Property insurance may cover this stuff, but not always.
Spoilage: This coverage takes care of the replacement costs of food that spoils due to power outages caused by storms, surges, etc.
Communicable disease: Covers any illnesses transmitted to customers due to improper hygiene of your employees.
Optional Add-Ons to Restaurant Insurance in New Hampshire
The basic restaurant insurance package is a great start, but in reality, it probably won't be able to meet all of your unique needs. Your agent will hook you up with any additional coverage that's necessary, but for now, let's take a look at some of the most common add-ons:
Commercial/business auto insurance: If you run a carry-out restaurant that makes deliveries, you'll want to look into getting coverage for your company vehicles from things like theft and vandalism. Your restaurant will also be held responsible for damage done by your driver while in a company vehicle. Food trucks will also need this coverage.
Coverage for signage: This coverage protects your signage from things like weather and vandalism since it's not typically covered under regular property insurance. It's especially important for restaurants with a drive-thru, with all the extra signage that could be damaged due to distracted or impaired drivers, or vandalism.
Art floater insurance: For bigger/fancier restaurants with artwork on display, this coverage is another great idea. You'll have to get an appraisal for the specific pieces you want to cover, first. In case of fire or even theft, it'd be a shame to have to pay for the replacements out of pocket.
Liquor liability insurance: While not mandatory, this coverage can fill in some important gaps. General liability will NOT protect you if your employees overserve a customer who ends up with a DUI or other alcohol-related charge. Coverage is more necessary for smaller restaurants, as chains tend to have stricter serving rules and training policies in place to prevent mishaps.
How Do New Hampshire's Dram Shop Laws Influence My Coverage Needs?
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 New Hampshire, 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 New Hampshire's unique laws. They'll also explain the costs associated with each level of coverage.
Your New Hampshire Restaurant May Need Hurricane and Flood Insurance
New Hampshire deals with its fair share of natural disasters, two of the most common being hurricanes and flooding. The standard restaurant insurance policy may not cover hurricane or flood damage. So, it's important that your restaurant has adequate coverage before you hang that "OPEN" sign on your door. Ask your agent to go over your policy to make SURE you're covered. Between the hurricanes in the warmer months and those infamously harsh New Hampshire winters (that eventually lead to tons of snowmelt), you might have to face some form of aggressive water. Having coverage can prevent you from later having to clean up Mother Nature's mess — and pay out of pocket for it.
How Much Does Restaurant Insurance Cost in New Hampshire?
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. However, a typical range for coverage starts on the low end of about $10,000/year for a smaller establishment with fewer employees and hits the high end of 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.
What's the Safest/Cheapest Kind of Restaurant I Can Start?
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.
What's the Most Expensive/Riskiest Kind of Restaurant I Can Start?
On the other end of the spectrum, a large dine-in restaurant chain with tons of employees and features like salad bars, buffets, and liquor bars 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.
What's So Great About an Independent Insurance Agent?
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.
Finding/Comparing New Hampshire Restaurant Insurance Quotes
Our wise and helpful agents will help you determine which type of New Hampshire restaurant insurance makes 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.