Starting a bar can be a lucrative business opportunity but comes with many risks. Intoxicated customers can be uncontrollable and your business risks exposure from their actions resulting in damages or injury. Getting insurance for bars helps offset these risks and protects your business from financial loss. Here are six kinds of insurance policies every bar owner needs:
1. General Liability
Accidents like slips and falls during normal business operations can cause bodily harm. Your business might suffer property damage that can prove costly to repair.
General liability insurance will prevent your business from bearing the full cost of property repair or medical expenses in case of an accident. Some states require most businesses to have general liability insurance before getting licenses to start business operations.
2. Liquor Liability
Intoxicated customers can cause bodily harm to themselves or others and third-party property damage, all of which your business is liable for. Depending on the laws within your state, you may be responsible if your business sells alcohol to a client who later operates a motor vehicle and causes an accident. You should get a liquor liability policy to shield your business against such liability.
Liquor liability insurance is often a legal requirement for all bars and establishments selling alcohol to get a liquor license. Your insurer protects you from financial loss since injury or property damage claims can be expensive to settle.
For adequate coverage, you must disclose the types and amounts of food and alcohol your institution serves.
3. Workers’ Compensation
Your employees face numerous risks when serving customers on your premises. If your employees are injured on your premises, you are liable. Workers’ compensation insurance shields your business from financial loss if such accidents happen.
Workers’ comp takes care of lost wages and treatment costs for employees that get injured while on the job. Such coverage allows you to care for employees during recovery until they return to work. Workers’ comp can entail death benefits to your employee’s beneficiaries if they succumb to workplace injury.
4. Business Income
Suppose you experience fire or floods in your business: such events can force you to close shop. During the time your bar remains closed, you suffer losses through continued expenses like wages and loss of sales. Loss of business income can be catastrophic, so you need coverage to prevent going bankrupt.
Business income or expense insurance covers your bar in cases where you are out of business. Your insurer will take care of expenses like settling supplier debt and wages while you are out of business. Business income coverage is beneficial, especially in areas where natural disasters like flooding occur frequently.
5. Commercial Property
While damage to other people’s property remains covered under the liquor liability policy, the coverage does not extend to your business premises. Damage to your business premises can be expensive, so you need coverage regardless of if you operate on rental property or own the building.
Commercial property coverage is the policy option that adequately covers your business in the event of property damage. This insurance option offers coverage on a pre-agreed value or replacement cost valuation. Pre-agreed insurance coverage has cheap premiums, but insurers only damage to a specific value, which might be insufficient to cater to all replacement costs.
Replacement cost valuation options take care of the entire replacement, helping you get your business back up and running. Before your insurer offers you commercial property coverage, they will seek an accurate property valuation. This allows them to calculate the premiums for adequate coverage in an accident.
6. Data Breach Coverage
Online and credit card transactions make your business’s POS a key data hub. Client data must remain confidential, but hackers and scammers target your business for such data.
A data breach can cause many problems for your business and you may need coverage to handle any expenses in the event of claims. If your bar gets sued for a data breach, your insurer will take care of the legal costs and compensation where necessary.
Get Adequate Insurance for Bars
Bars can be lucrative, but they are exposed to multiple risks. You should get adequate insurance for bars to protect your business from financial loss and employees or clients from injury. Your insurer will evaluate potential risks in your business to make sure you remain fully covered.