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Don’t Get Burned: Common Insurance Mistakes Restaurant Owners Make and How to Avoid Them

by | Feb 11, 2022

As a restaurant owner, you’re not just providing a place for people to eat; you’re creating a space for connection, celebration, and the sharing of memorable experiences. Managing a restaurant comes with its own set of challenges, but it’s essential to protect your business and your finances. Here are some common insurance mistakes we’ve seen restaurant owners make over the years and how to avoid them.

Appreciating the Risks:

Bad things can happen to even the most diligent restaurant owners. Employees and customers can get hurt, fires can cause severe damage, equipment can fail, or lawsuits can arise. Insurance is not an empty expense; it’s a vital safety net for your business. In fact, 40% of small businesses are likely to experience a property or general liability claim in the next 10 years, with an average cost of $30,000 per claim.

Getting the Right Coverage:

It’s crucial to have the appropriate coverage for your specific circumstances and risk tolerance. Don’t just focus on the policy types; pay attention to the coverage details and limits. Ask your insurance provider about any potential gaps in your coverage and discuss optional coverages that may be relevant to your restaurant. Some common oversights for restaurants include:

  1. Tenant improvements: Essential if you rent your space.
  2. Equipment vs. Personal Property: Companies vary in how they handle this! Ensure all the property you own is covered.
  3. Data breach: Protect sensitive information about your customers and employees.
  4. Employment Practices: Claims or incidents of harassment, discrimination, etc., can be costly. Don’t go it alone.
  5. Non-Owned and Hired: Protect your business if an employee causes an accident while running an errand for you.
  6. Personal Umbrella: Ensure you have enough personal liability coverage to protect yourself in the event of a claim.
  7. Life Insurance: Provide your business and loved ones with the resources they need to carry on without you.

Creating a Comprehensive Insurance Plan:

Many restaurant owners make the mistake of working with multiple insurance agents for different aspects of their business. This fragmented approach can lead to redundancies and gaps in coverage. Instead, work with a single insurance professional who can provide a comprehensive plan, addressing all your insurance needs and maximizing savings through bundling and discounts. Comprehensive planning:

  1. Avoids potential unpaid claims by identifying gaps in coverage.
  2. Saves money by discovering redundant coverage.
  3. Maximizes savings through bundling and discounts.
  4. Sends the message that you care about being protected.
  5. Helps you sleep easier, knowing you’ve got a solid plan.

Staying on Top of Changes:

Review your insurance coverage at least once a year and keep your insurance provider informed of any changes in your business. This proactive approach ensures that your coverage remains adequate and up-to-date as your restaurant grows and evolves.

Working with a Trusted Insurance Expert:

As a busy restaurant owner, it’s crucial to have a team of professionals to support you, including a dedicated insurance expert. The right expert can help you navigate coverage options, find the best insurance companies, and provide ongoing service and support during claims.

Prioritizing Safety:

Workplace injuries are the most common claims in the restaurant industry. Too many claims can lead to higher workers’ compensation premiums. Invest in employee safety by providing non-slip shoes, using Kevlar gloves for cutting tasks, training employees on equipment use, and promoting a culture of safety.

Our Page Restaurant Insurance Experts can Help

Running a successful restaurant involves juggling many responsibilities, but protecting your business with the right insurance coverage is essential. By being aware of common mistakes and working with a trusted insurance professional, you can safeguard your business, your finances, and your peace of mind.


Ben Page, a Business Development specialist with over 20 years in the insurance industry, is an expert in Property & Casualty, Life, Health, and Disability insurance. Ben is licensed in all 50 states and dedicated to empowering clients with insider knowledge and making insurance more accessible. Passionate about client-centric service, he has helped build several successful insurance agencies. Ben enjoys Jeeps, Rock and Roll, cheese, movies, and spending time with his wife, three kids, and their golden doodle when not working.