types of restaurant insurance
by Laura-Andreea Voicu

Restaurant owners face risks that are unique to their industry. Commercial kitchens can be extremely dangerous places to work. Employees rush on slippery floors, use sharp knives, cook on hot stoves, and lift heavy, bulking items. Couple these hazards with sometimes young and inexperienced employees, and you may have a recipe for disaster.

These unique hazards mean restaurant owners must have the proper restaurant insurance coverage to protect their employees and their business operations. Additionally, many restaurants are still returning to full strength following the shutdowns during the COVID-19 pandemic, and the workforce is expected to grow by 400,000 jobs in the industry. An increase in new workers can mean an increased risk of accidents and injuries in the kitchen or on the main floor.

Common Restaurant Worker Injuries and Other Restaurant Risks

Over one million restaurants in the United States employ nearly 15 million workers. These workers face a variety of daily hazards. These can jeopardize their health and safety and impact the entire organization’s operations.

Not only that, but restaurant owners face other issues, such as equipment breakdown, spoiled food, and delayed deliveries that could cost them thousands of dollars.

Some of the most common risks restaurant employees and owners face include the following:

1. Slips, trips, and falls

Slip and fall accidents can occur in restaurants for various reasons. Wet and slippery floors from spills like grease and oil from cooking or water from the dishwashing station can easily create a hazardous situation for workers.

Additionally, objects like food trays left in high-traffic areas or slippery front entrances and exit ways can lead to tripping accidents for both employees and restaurant patrons.

2. Burns

According to the Burn Foundation, the restaurant and food service industry reports around 12,000 burns each year, which is the highest number of burns in any employment sector. This number makes sense when you consider that employees in commercial kitchens are exposed to hot surfaces, deep fryers, and scalding grease that can cause severe burns.

These burns often occur due to a lack of proper food handling. Workers may use kitchen towels instead of oven mitts to grab hot pots and pans off the stovetop or lift heavy stockpots full of hot liquids without allowing them to cool. Or employees may be unfamiliar with the procedures for using deep fryers correctly.

3. Cuts and punctures

Cuts are a constant risk in commercial kitchens. Many employees work with sharp knives and tools like mandolin slicers regularly. In fact, according to the AmTrust 2022 Restaurant Risk Report, cuts are the most common cause of injuries in restaurants. Staff might not receive proper knife training. They may also not be required to wear protective gear, like safety gloves for cutting or Kevlar gloves, when slicing and dicing.

4. Strains, sprains, and fractures

Repetitive movements, standing in one place for extended periods, awkward postures, falls on slippery floors or from heights (such as when using a ladder to retrieve items off a high shelf), and lifting heavy objects incorrectly, can all cause strain, sprain, or fracture injuries.

5. Chemical exposure

Restaurant employees are often exposed to cleaning, disinfecting, and maintenance chemicals. These are known to cause issues like respiratory problems, burns, irritation of the skin and eyes, and even damage to internal organs. The common cleansers, soaps, degreasers, sanitizers, and floor cleaners used in commercial kitchens often contain hazardous chemicals that can affect employee health.

6. Mental health issues

Employee mental health became a prominent concern during the COVID-19 pandemic. Employees in all industry sectors reported higher-than-average stress levels. Everyone worried about their health and finances, and burnout became a common reality.

Mental health issues in the hospitality industry skyrocketed throughout the pandemic. However, this fast-paced industry has always been at the top of the list of most stressful careers, just behind healthcare.

The declining mental health of restaurant workers has been a growing issue over the last several years, with everyday stressors such as a lack of consistent income and health benefits, irregular work schedules, and high turnover rates taking a toll.

7. Property or equipment damage

Imagine a pipe bursts in the kitchen and causes a small flood on the premises, damaging floors, walls, equipment, and everything in its wake. Not only does the restaurant owner have to deal with the clean-up. Such an event could also cause the business to close for several days or weeks.

The walk-in refrigerator could break down overnight and lead to spoiled food. Or a stove might suddenly not work one day, leading to an interruption in business and the loss of income.

6 Types of Restaurant Insurance You Need

Restaurant insurance helps business owners cover unexpected costs should an accident occur or when something goes wrong on the premises.

What type of insurance does a restaurant need? Below are six coverages all restaurant owners should consider.

1. Workers’ compensation

Workers’ compensation insurance provides benefits to employees who get injured on the job. This coverage addresses medical care and related costs for the injured worker, temporary or permanent disability benefits, skill enhancement and job retraining, and death benefits for spouses and dependents.

2. Cyber insurance

Restaurant owners may not think they are at high risk for falling victim to a cyber-attack, but any business that utilizes computers and credit cards should consider adding cyber insurance as necessary coverage. Cyber insurance provides coverage for losses for ransom payments for ransomware attacks, data and system recovery, business interruption caused by a cyber event, reputational harm, and more.

3. Commercial property

A natural disaster, fire, or theft can bring a restaurant’s operations to a screeching halt. Commercial property coverage protects the building, its contents, business income, and rental income from commonly experienced losses. Examples are pipes bursting, fires, storm damage, theft, vandalism, and more.

4. General liability

General liability insurance is crucial for restaurants. It provides coverage for bodily injury, personal injury, and property damage caused by the business’s operations, products, or injury that occurs on the business’s premises. It also covers third parties or their property being harmed because of something the employees did or failed to do.

5. Businessowners policy (BOP)

A businessowners policy, or BOP, combines basic coverages businesses need into one bundle for a lower premium. For instance, most policies include general liability, property, and business interruption. You may also have the option to add other coverages like cyber and crime.

6. Commercial package policies (CPP)

While a BOP bundles coverages for small to mid-sized risks, commercial package policies feature coverage that you can tailor to your organization’s specific needs. This includes those with unique risks, such as restaurants and others in the hospitality industry.

Additional Restaurant Insurance Coverages to Consider

Some insurance carriers offer restaurant coverage enhancements to their policies for even further protection. These enhancements include options like property and liability enhancement endorsements, coverage for foodborne contamination and spoilage, peak season coverage, and umbrella limits to include or exclude liquor liability.

Restaurants that utilize food delivery vehicles are often also required to obtain commercial auto insurance for property damage, bodily injury, and personal injury protection.

Protect Your Business with Proper Restaurant Insurance Coverage

Owning a restaurant is often a dream come true for many entrepreneurs. Although not without challenges, it’s a rewarding career where business owners get to bring their vision to light every day. It is vital to protect that dream and vision with the proper restaurant insurance coverage. That way, your business can continue to grow and thrive.

This article is a guest post.

photo of GloriaFood blog writer Laura-Andreea Voicu
Laura-Andreea Voicu

Laura-Andreea Voicu is an experienced content writer with a knack for marketing and SEO. She creates guides and resources designed to help restaurants grow their presence online and boost sales.

She has been featured on the Oracle Food and Beverage Blog and wrote for Search Engine Journal, Clutch, Sender, Venngage, Quickbooks, and many more.

Find me on LinkedIn.