How Insurance Protects Your Fast Food Restaurant
You’re used to hearing “I’ll have a burger with fries” or “I’ll have a slice of pizza, to go.”
What you don’t want to hear is: “We’ve got a problem.” As a fast food restaurant owner, you face risks every day from kitchen fires to slips and falls and theft. A fast food restaurant insurance package will protect your business.
Is your fast food restaurant downtown on King Street or is it at Yonge-Dundas Square where hungry shoppers and tourists want a bite to eat? Do you sell veggie wraps on Queen Street West or have a noodle shop on Spadina Avenue?
Do you serve takeout rotisserie chicken on Wellesley Street East or Greek takeout on the Danforth? Do you sell sandwiches on Bloor Street?
Wherever you’re located in Toronto or anywhere in Ontario, your Western business insurance expert will give you top-notch insurance advice and ways to save.
What types of fast food restaurants need an insurance package?
You need an insurance package if you operate a fast food restaurant that sells:
- Burgers and fries
- Fish and Chips
- Fried chicken
- Hot dogs
- Ice cream
How will a fast food insurance package protect my business?
You need to protect your fast food restaurant from the potential risks associated with its daily operations.
Without insurance, you would have to cover these costs out of your own pocket. Can you take on that kind of risk?
A restaurant Insurance package can help protect you from these 3 common claims:
1. A customer slips and falls in your sandwich shop due to a wet floor, breaks an ankle and sues you.
2. An employee steals cash from your fast food restaurant.
3. A customer says your takeout food made them sick.
As a fast food restaurant owner, here’s an insurance check list:
- Do you have the best business insurance rate for your fast food business?
- Do you have the right amount for your deductible and regularly review it to make sure it’s the right amount for your business?
- Is your number of employees up to date?
- Do you know the value of your equipment and is it properly insured?
- Have you thought about the consequences of a kitchen fire that shuts down your fast food business temporarily?
What’s in a fast food restaurant insurance package?
Commercial General Liability (CGL) Insurance: This type of insurance helps protect your restaurant from a loss if you’re found legally liable for bodily injuries either on or off your restaurant’s premises.
CGL can help pay legal and medical costs if a customer is injured at your restaurant; for example, they slip on wet floor or on an icy patch on your restaurant’s sidewalk.
It’s important to note that without commercial liability insurance, you would be responsible for paying any liability costs out of your own pocket.
Your CGL policy also can help protect you from libel, slander, copyright infringement, and false advertising allegations.
How much CGL insurance do I need?
It’s not uncommon that a fast food restaurant would carry $2 million in CGL coverage, depending on the size of your operation.
The size of your restaurant, number of employees, and claims history will be factors in how much liability insurance you need.
Commercial Property Insurance: Whether you own or rent your fast food restaurant location, commercial property insurance protects your business and its contents from insured risks that can happen, such as fire, theft, flood, or vandalism.
If vandals smash a store window, commercial property damage could cover the costs of replacing the window and cover any damage or vandalism inside your business.
Commercial property insurance typically includes flood insurance, but what if there’s a heavy rain and the sewers back up and your business is flooded?
You should consider adding sewer backup or overland flood coverage extensions, which standard business insurance policies typically do not cover.
Equipment Breakdown Insurance: Your baking business likely has expensive electrical and mechanical equipment to keep your products either frozen or refrigerated.
Equipment breakdown insurance provides coverage for property damage from the sudden and accidental breakdown of insured equipment not automatically covered by a standard commercial property policy.
You’ll need to have a list of your bakery equipment and how much it’s worth.
Product Liability Insurance: If a customer gets sick after eating your food, this type of insurance may cover the cost of the customer’s medical expenses and your legal and court-related costs to defend yourself.
Crime Insurance: It should be part your fast food insurance package.
Crime insurance can protect you against theft, credit card fraud, forgery, counterfeit, and other types of fraud that employees sometimes commit.
Cyber Insurance: If you process debit and credit card transactions, online or in person, you need cyber insurance. Your system could be vulnerable to cyberthieves.
Without cyber insurance, you will have to pay out of your pocket for the cost of restoring your bakery’s system if it’s hacked.
You may also be liable for damages to third parties whose information has been stolen and you may have to pay for notification expenses to inform customers affected by a breach.
Commercial Auto Insurance: If you have a business car, van, or truck that you use for your bakery business, it won’t be covered by your personal car insurance policy. You will need commercial coverage as part of your insurance package.
What if my fast food restaurant delivers food via a third-party app and I get sued?
As the business owner, the liability falls back on you for any products sold through any platform. Read through the agreement you have with the third-party delivery provider to see if there could be any terms and agreements that remove your liability once your fast food restaurant’s food enters the delivery car.
Business Interruption Insurance: This type of coverage helps support you when your restaurant can’t operate due to a covered loss. Bills like repairs, inventory, rent, and payroll keep rolling in even if your business is forced to close.
Some examples of losses that can force your business to shut down:
- Your restaurant is damaged by fire or vandalism
- A disruption in your supply chain
- Damage to a neighboring business prevents your business from operating
What do I do if my fast food business has an insurance claim?
- Contact your broker immediately after any business-related mishap. Waiting to file a claim can confuse insurers about the severity of the damages to your business.
- Know your policy so that when you contact your broker you are familiar with what will be covered or not.
- Document the damage. Take photos right away and write down what happened.
- Do not throw away damaged goods after taking photos. Keep the physical evidence so that your adjustor can see it.
- Do not invite lawsuits. Don’t say anything that could be used against you, especially if you aren’t sure what happened.
- Be honest about what your damaged property is worth. Damaged commercial property is generally valued according to its actual cash value or replacement value.
Western Insurance has licensed BUSINESS INSURANCE EXPERTS to get your fast food restaurant the right insurance package. Our experts are available now to help you navigate the business insurance journey to protect your fast food business.
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