Why is restaurant insurance unique?

NDML have been a specialist insurance broker for restaurants and night time leisure venues for the past 20 years. In an industry where things change and adapt more often than you have hot dinners, that’s quite a feat.

We put our longevity down to the fact that we specialise. For many companies that offer insurance for the night time leisure industry, it’s just one string to their bow. And because it’s not always a priority for them, they often don’t study the entertainment landscape as much as they should.

Only by understanding the restaurant business, can you anticipate risks.

Restaurants are part of an unstable economy. Look at the amount of restaurant chains that have gone into administration or out of business in the last few years.

Some of those were down to changing consumer habits and there isn’t much we can do about that.

But we can make sure that we protect restaurant owners against risks under their control.

Most business risks at a restaurant are obvious.

Public Liability and Employers Liability is there to protect you against slips, trips and offensive weaponry (cutlery) risks. And contents and buildings cover should protect you against your business being subjected to a theft or a storm blowing your roof off.

But any insurer worth their salt will be able to foresee those risks.And they aren’t what makes restaurant insurance unique. As specialists, we use our experience in the industry to look beyond the obvious.

No two restaurants are the same, even if they’re part of a chain. But there are characteristics that many restaurants share that can produce the same risks. These include factors like:

  • Location: we don’t just look at the postcode. We take into account the neighbours, the council, the age of the building complex it’s situated in, what businesses may come into or leave the area etc.
  • The style of the restaurant: Chains have a completely different risk set to independents, but the food served or the style in which they serve it will also be a factor. For instance, if your restaurant serves beef, we look at the risk of political or health factors affecting your supply chain.
  • Are you licensed to serve alcohol: If your restaurant is a curry house, it may have a certain dependence on the beer it sells. Likewise, if you run an Italian eatery, a large section of your profits may come from wine sales. If you were to lose your license to serve alcohol, how would your business cope?

Restaurant insurance requires a specialist because risk management is so important. You can manage standard risks, like slipping on spilled food, fairly easily

But only a specialist can predict the more unusual risks. For example, there was recently an all-you-can-eat restaurant in China that had to close because customers ate too much. This is a silly example, but it’s a risk that could have been foreseen had the people involved in business risk management had more experience in the area.

The little things make the difference.

So to answer the question in the header, why is restaurant insurance unique? Because you can only predict the future of one restaurant, if you understand the past of many more.