The Guide to Picking The Right Restaurant Insurance in Ontario


Mar 20, 2020

Looking for more information on picking restaurant insurance? We've got you covered.

Owning a restaurant in Ontario means your insurance needs are most likely different than other business owners. When your establishment serves food and alcohol using expensive equipment, your liabilities and risks are not quite the same as a bookstore owner's. It may seem overwhelming trying to understand all the coverages you need and don't need; we broke down a guide to picking restaurant insurance coverages in Ontario:

Commercial General Liability Insurance (CGL)

Commercial General Liability insurance, or CGL, provides protection against:

-Bodily Injury and Property Damage

-Personal and Advertising Injury

-Medical Payments

-Tenants Legal Liability

-And in some cases, can include Employers Liability and Non-Owned Automobile Liability coverages.

All businesses should be carrying a CGL policy as it covers defense and damages against a lawsuit if your products or services cause or are alleged to have caused bodily injury or property damage to others. Serving food or alcohol can be fast track to a claim - even if it isn't your fault! Having a CGL policy can also protect you if someone slips on a freshly mopped floor, gets injured and sues you; it would help cover damages, medical and legal fees.

You can't predict or protect yourself from a lawsuit arising. Litigation may be someone's only option to eliminate their liability or cover their medical expenses. It also allows for peace of mind and credibility.

Property Insurance

Commercial Property insurance coverages protect a company's physical assets against loss or damage from a broad range of causes. This doesn't only apply to buildings or units but inventory, equipment, furniture or installed fixtures too. As a restaurant owner you know that the probability of a fire happening in a business increases when there's deep fryers, hot ovens and flaming stovetops involved. Having the right property insurance coverage in place can help ease your mind. Property of others that is in the care, custody and control of your business would also be covered which further protects your company.

Crime Coverage

Money, forgery and other financial assets/instruments are not included in your CGL or property insurance coverage. If a large portion of your sales goes to alcohol, money can add up quickly. That's great news but it also quickly makes you a target for theft or fraud from people outside, and unfortunately, inside your business. Not only does crime coverage include fraudulent checks, counterfeit money and credit card fraud; but acts of fraud and theft committed by one of your own employees.

Equipment Breakdown

Equipment Breakdown can provide coverage for loss or breakdown due to mechanical or electrical breakdown of nearly any type of equipment. Say a power outage causes your fridge to stop working completely; this insurance could provide coverage.

D&O Insurance

D&O insurance provides coverage for a business and its management including corporate directors and officers from legal claims and lawsuits brought by various stakeholders the restaurant is affiliated with such as customers and suppliers. The coverage includes settlement and legal fees, among other things.

Cyber Insurance

If you store your customer's information online, it is susceptible to hacks. Cyber insurance provides incident coverage for cyber liabilities such as phishing, malware, system interruption and privacy liability.

Products Liability

In a restaurant, the product you're providing is more than likely food and/or alcohol. Say someone with a peanut allergy eats at your restaurant, has an allergic reaction and wants to hold your establishment liable. Similarly, let's say someone started drinking at your establishment, got over-served at a different location afterwards and then got injured. They can still find you liable. In both scenarios, even if it's not your fault, this policy can help cover the legal and medical fees that could severely harm your business and profits.

Often product liability claims exist because:

- The product injured the consumer's body

-The product injured the consumer's property

-The food or beverage product made the consumer ill

Business Interruption

Business Interruption or Business Income insurance is not a stand-alone coverage. It is an extension of business property insurance that can cover profits, fixed costs - including ordinary payroll and extra expenses - when a business property claim arises to cover the profits you would have earned had the loss not occurred. This can be extremely important coverage as extra expenses can interrupt the ability for a restaurant to continue servicing its customers and meeting contractual obligations. Say you have a fire and need to close for repairs; without this coverage extension, your establishment may have to permanently close.

Whether it's a roast dinner or Korean BBQ, food and drink has a special way of getting people to come together. At Foxquilt, we believe in the power of numbers and community. That's why, we let restaurant owners leverage their community to get better buying power and group savings on their restaurant insurance in Ontario.

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