Hospitality & Restaurant
Hospitality has the highest claim frequency of any commercial line we write. Slip-and-falls, kitchen fires, food contamination, liquor liability, employee turnover. The right program isn't a single policy. It's a coordinated stack across multiple specialty carriers.
What it is.
Restaurants, bars, hotels, motels, cafes, and catering operations all share a common risk profile: high public traffic, fire and water exposure in commercial kitchens, food and beverage liability, and employees who are often young, hourly, and quickly turning over. Standard small-business policies are not built for this.
We work with hospitality specialty carriers including Hospitality Insurance Group, AmTrust, Hartford, and others who actually understand the difference between a sports bar and a fine-dining restaurant when they price the policy. The savings vs a generalist carrier is often 20% to 35%, with broader coverage on the things that actually fail.
Below is what a complete hospitality program covers, the endorsements that matter most for restaurants and hotels, and the questions underwriters ask that determine whether you get the good rate or the standard rate.
Restaurants, bars, lounges, breweries, hotels, motels, B&Bs, banquet facilities, food trucks, catering operations, cafes, and any business serving food or alcohol to the public.
What it covers.
Each policy is a stack of named coverages. Required parts are mandated by state law. Recommended parts are what we put on most policies. Optional parts depend on your situation.
General Liability
Slip-and-falls, foodborne illness claims, third-party property damage. Limits typically $1M per occurrence / $2M aggregate as the floor for hospitality. Often raised to $2M/$4M with an umbrella for higher-traffic operations.
Liquor Liability
Required by most landlords and lenders for any establishment serving alcohol. Pays defense and damages for claims arising from over-serving (assault on the premises, drunk driving causing injury after leaving). Different from GL. Hospitality policies often include it; pure-restaurant policies usually don't.
Commercial Property
Building (if owned), business personal property, kitchen equipment, furniture, fixtures, signage. Replacement cost basis. Hospitality property has higher fire-rate factors than most occupancies.
Business Income / Extra Expense
Pays lost income and operating expenses while you're shut down after a covered loss. Critical for hospitality because the rebuild cycle for a kitchen fire is often 4 to 9 months. We size this carefully and look at extended business income (often 6 months past reopening) for slow recovery.
Equipment Breakdown
Mechanical and electrical failure of HVAC, refrigeration, walk-in coolers, ice machines, ovens, fryers. Standard property excludes mechanical breakdown. This endorsement adds it back for usually $200 to $600 a year.
Food Contamination / Spoilage
Two distinct exposures. (1) Spoilage from power outage or equipment breakdown destroying refrigerated inventory. (2) Food contamination requiring shutdown, decontamination, and lost income (e.g., positive listeria test). Both available, often as endorsements.
Workers Compensation
Required for any restaurant or hotel with employees. Hospitality class codes are higher-rated due to burn, slip, and laceration risk. Strong return-to-work programs and safety training drop the experience modifier and the premium materially.
Hired and Non-Owned Auto
Covers liability when an employee uses a personal car for catering deliveries, supply runs, or off-site events. Critical for any operation that ever sends an employee out in a personal vehicle.
Assault and Battery Coverage
Many liquor and hospitality policies sub-limit assault and battery (often to a fraction of the GL limit). For nightclubs, sports bars, and high-volume liquor operations, increasing this matters. Confirm the sub-limit before binding.
Hotel-Specific: Innkeeper's Liability
Covers liability for guest property in your care. Default sub-limits in standard property policies are very low. Hotels and B&Bs need this raised meaningfully.
When it kicks in.
Real situations we see in the agency. The point is to show how each layer of coverage maps to actual life, not to scare you.
Kitchen fire shuts down restaurant for 4 months
Grease fire spreads from the fryer to the hood. Property pays building damage (or landlord's insurance if leased), BPP for kitchen equipment, Business Income for lost profits during the rebuild, Extra Expense to expedite contractors and lease a temporary kitchen for catering.
Customer slips on wet floor near the bar
Routine but expensive. Mop bucket out during dinner service. Customer slips, breaks an ankle, ER visit, surgery. GL pays medical, lost wages, and any settlement.
Power outage spoils $35K of inventory
Storm knocks out power for 18 hours. Walk-in coolers fail. Most property policies exclude utility-interruption spoilage. The Spoilage endorsement (or Utility Services Interruption) is what pays.
Bar patron leaves drunk, causes accident
Patron over-served, drives home, causes injury accident. Victim sues the bar under dram-shop / liquor liability law. Liquor Liability policy responds. Without it, the GL policy excludes this entirely.
Listeria detected in cold-prep station
Health department shuts down the operation. Food Contamination endorsement pays decontamination costs, replacement of contaminated stock, and business income during the shutdown.
Key terms.
Plain-English definitions. The vocabulary insurance carriers assume you already know.
- 01Dram Shop / Liquor Liability
- Legal liability for serving alcohol to someone who later causes harm. Connecticut and most states have dram-shop laws making bars and restaurants potentially liable for over-service.
- 02Host Liquor Liability
- Different from full liquor liability. Covers occasional service of alcohol at private events (e.g., office holiday party) where the business isn't in the alcohol business. Usually included on standard GL.
- 03Assault and Battery Sub-Limit
- Cap on coverage for fight-related claims, often a fraction of the GL aggregate. Nightclubs and sports bars frequently need this raised.
- 04Extended Business Income
- Coverage for the slow ramp-up after reopening, typically 30 to 180 days past the reopening date. Often the difference between staying open after a long shutdown or not.
- 05Innkeeper's Statute / Posted Notice
- Most states have laws limiting hotel liability for guest property IF the hotel posts the statutory notice and offers safe-deposit storage. Worth knowing for the basic compliance step.
- 06Tap Coverage
- Some liquor policies exclude assault and battery, off-premises incidents, or specific entertainment risks. Read the exclusions before assuming you're covered.
Common questions.
Questions clients ask before they get on the phone with AJ. If yours isn’t here, just call.
Higher claim frequency (slip-and-falls, kitchen fires, foodborne illness), liquor exposure, employee turnover, late-night operations. Specialty hospitality carriers price these accurately. Generalist carriers either decline the risk or charge more for less coverage.
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