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Risk Management for Bars, Taverns, Restaurants and Nightclubs

Bookmark and Share Bars, taverns, restaurants and nightclubs face unusual risks. If you own or work at one of these establishments, understand your risks and the risk management insurance you need.

Potential Risks for Bars, Taverns, Restaurants and Nightclubs


While every business is slightly different, there are common risks bars, taverns, restaurants and nightclubs face. They include:

  • Liability if guests or employees fall, slip or are injured
  • Liquor Liability if a guest drinks too much and causes an accident or other liability
  • Food Contamination
  • Fire Hazards
  • Increased Pollution Liability Regulations
  • Theft
  • Assault and Battery
Why Purchase Risk Management Insurance?

Because the risks are high for your bar, tavern, restaurant or nightclub, you need insurance. It covers any injuries, illnesses or liabilities that occur on your property. It also protects your personal assets if you are sued.

How to Purchase Risk Management for Bars, Taverns, Restaurants and Nightclubs

Contact your insurance agent for information on purchasing insurance for your establishment. Qualified businesses include:

  • Neighborhood bars, pubs and taverns
  • Restaurants with high-percentage alcohol sales
  • Craft brewpubs
  • Sports bars
  • Nightclubs and discotheques
  • Wine bars
  • Cocktail lounges
  • Comedy clubs
  • Fraternal Organizations
To ensure you get adequate coverage for your needs, discuss details about your specific establishment with your insurance agent. Factors like how long your employees have worked in the industry and the types of guests you serve can affect the type of insurance you purchase and your insurance premiums.

Ways to Decrease Your Risks


To reduce your risks, protect your staff and patrons, and potentially lower your insurance premiums, follow a few steps.

  1. Enroll managers, servers, door hosts, bouncers and all employees in regular training courses that help them learn techniques that reduce risks. Potential trainings address legal responsibilities when serving alcohol, how to recognize and prevent intoxication and food safety.

  2. Hire experienced staff. Experienced staff are less likely to engage in risky behavior and some insurance companies give lower rates to establishments with staff who have over three years of experience.

  3. Card everyone. This step ensures you don't serve any minors.

  4. Limit free drink giveaways so you don't encourage intoxication.

  5. Establish protocols for handling inebriated guests. Your employees should know to call a cab or take other protocols if someone has had drank too much.

  6. Be vigilant about reducing risks. Keep the floor clean, follow safe food guidelines, make repairs right away, ensure there's adequate outdoor lighting and take other steps to reduce risks around your establishment.
When you understand risk management for bars, taverns, restaurants and nightclubs, you can take the necessary steps to protect your employees and patrons. Talk to your insurance agent for more ideas on managing and reducing your risks.
 

The Importance of Proper Safety Training

Bookmark and Share This real-life case reinforces the need for every business to provide OSHA-required training.

A West Virginia company assigned a new employee – call him Jim – to drive a forklift, even though he had no experience or training in forklift operation "There's nothing to it," his supervisor told Jim. "It's just like driving a car." However, his first few weeks on the job turned out to be bumpy. Several times on each shift, while driving the forklift, he would knock things over. Although the supervisor warned Jim to be more careful, he continued to bump his way through the workday, leaving a trail of destruction wherever he went.

About three weeks after being hired, Jim's supervisor instructed him to drive down a narrow aisle between two rows of stacked, loaded pallets. After objecting, Jim reluctantly proceeded down the aisle. His left foot, which was dangling outside the forklift where it shouldn't have been, became pinned between the forklift and the wall of pallets. Jim suffered multiple fractures of the foot, together with a badly twisted knee; both injuries required surgery. Instead of going back to work, Jim went to court, filing suit against his employer and his supervisor for negligence.

His argument was clear: The company and his supervisor failed to provide safety training that could have prevented the accident. Jim's attorney told the court that, although OSHA regulations mandated specific training, testing, and certification for forklift operators, the company had not trained, tested, or certified him. This meant that Jim should not have been operating a forklift – and if he hadn't been doing so, the accident would not have taken place.

The Supreme Court of Appeals of West Virginia agreed, ruling there was sufficient evidence to prove that both the employer and the supervisor were negligent. When they hired the employee; they knew that federal law required proper training or certification of forklift operators. Allowing Jim to drive a forklift without proper training was an act of negligence.

The message: Failure to provide OSHA-required training is a huge mistake. Whenever you hire new employees or assign workers to new jobs with new hazards, make sure that they receive proper training from the get-go. Never allow an employee to operate dangerous equipment or perform any other hazardous job until they have completed the required training and demonstrated competence, as well as understanding the hazards and necessary precautions.
 

What is Occupational Hazard Insurance?

Bookmark and Share Almost any job can be risky, but some jobs are more dangerous than others.  Occupational Hazard Insurance offers invaluable coverage for anyone who works in a dangerous job. Learn more about Occupational Hazard Insurance, especially if you work in a dangerous occupation.   

What is Occupational Hazard Insurance?

Your risk of injury or death increases when you work in a dangerous job. Occupational Hazard Insurance provides financial resources to you or your loved ones if you suffer an injury or die while performing your job. It's protective coverage that gives you peace of mind.

Who is Eligible for Occupational Hazard Insurance?

Employees who work in dangerous occupations are eligible for Occupational Hazard Insurance. However, each insurance carrier has different eligibility requirements.

Typically, you must be between 18 and 70 years of age to qualify for the coverage. Additionally, you may be required to undergo occupational training. Other special requirements can include licensing or a specific business model. For example, truck drivers must have a valid license and be self-employed or work as independent contractors to obtain this insurance. 

How Much Occupational Hazard Insurance do you Need?

Every state implements different regulations for Occupational Hazard Insurance. Check your state's requirements to ensure you purchase enough coverage.

You'll also want to purchase enough coverage for your needs. Be sure your policy covers your regular bills or is enough to give your survivors adequate financial resources to meet their needs and maintain financial security.

What are the Benefits of Occupational Hazard Insurance?

Most Occupational Hazard Insurance coverage includes several benefits. Check your policy for details. In general, a policy will cover:

  • Accident-related medical and dental expenses
  • Accidental death or dismemberment
  • Temporary or permanent disability
  • Reduction in disability income
  • Severe burn benefit
  • Paralysis
  • Survivors benefits
How Much Does Occupational Hazard Insurance Cost?

Expect to pay more for an Occupational Hazard Insurance policy since you are working in a dangerous job and the insurance company takes a big risk in insuring you. Additionally, other factors affect your premium. They include your:

  • Age
  • Industry
  • Safety history
  • Amount of coverage
  • Type of coverage
Your insurance carrier may also consider other factors when determining the cost of your premium. Discuss the details with your agent.

You may also wish to shop around. Compare policies and costs as you find the right Occupational Hazard Insurance for your budget and needs.

Occupational Hazard Insurance gives you financial resources if you're injured or die on the job. It's valuable coverage, so discern your needs and options before you work another day.
 

Is Your Business Exposed?

Bookmark and Share The September 11 terrorist attacks caused immense loss of life, human suffering, and property destruction, particularly at the World Trade Center in New York City. The insurance losses from injuries and property damage were very large. However, the losses resulting from businesses in the area having to shut down for extended periods of time were huge. Businesses filed nearly 5,500 business interruption claims for more than $12 billion following 9/11. For many organizations, the loss of income coupled with continuing expenses after a fire or other disaster can be even more devastating than the damage itself.

To increase the chances that a loss will not shut operations down permanently, organizations must assess their exposures accurately by asking some questions.

What is the most the organization could lose from a shutdown?

Commercial Property insurance policies define “loss of income” as the sum of the expected pre-tax profit or loss and necessary continuing expenses. For example, if the expected profit is $300,000 and necessary continuing expenses are $100,000, the potential loss of income is $400,000. To calculate their exposure to business interruption losses, organizations should refer to their balance sheets, profit and loss statements, and cash flow statements. Insurance companies also have worksheets available to assist with the calculation.

How much insurance should be carried?


Once the organization knows the dollar amount of its exposure, it must decide how much Business Interruption insurance to buy. The key considerations are the length of time the insurance is likely to apply and the coinsurance percentage the organization must meet. Coverage usually begins 72 hours following the damage to the property and ends when business resumes at another location or when the building should be repaired with reasonable speed, whichever occurs first. If the organization decided that the coverage period would be around six months, it could buy an amount of insurance that would satisfy a 50% coinsurance requirement. If the interruption would last longer, higher coinsurance percentage and limits would be necessary.

How long will it take business to return to normal?

Even after operations resume, it could be some time before revenue returns to normal levels. Customers who had gone elsewhere during the shutdown might be slow to return. The standard insurance policy extends coverage for 30 days after operations resume, but some businesses might need more time than that, especially if their businesses are seasonal. For example, a seaside restaurant in New Jersey that makes most of its profits during the summer will need additional coverage even if it can re-open in November.

How much of the normal payroll expense will continue during the shutdown?

The organization will need the continuing services of some employees while it attempts to re-open, but other employees might not be necessary. For example, accounting staff will be needed to pay mandatory expenses such as property taxes and collect receivables earned before the shutdown. Employees who stock shelves will not be needed if there are no shelves to stock.

Does the business depend on other businesses for revenue?

A business can suffer a loss even if its own building is untouched. A loss that shuts down a key customer or supplier or damage to nearby property that causes authorities to close off access to the street can devastate a business’s bottom line (this happened to many businesses affected by 9/11). Special insurance coverage is available to protect against this possibility. Our professional insurance agents can help you answer these questions and identify insurance companies that can meet coverage needs. With some effort and planning before a loss happens, an organization can emerge from a shut down and return to profitability.