Restaurant insurance

What types of restaurants can Suited insure?

Restaurants are probably one of the most varied food businesses we insure. Cuisine matters to an extent, but we’re usually just as interested in what happens in the kitchen, how food is cooked and what else the business does alongside serving meals.

Cuisines we can cover

We can consider a wide range of independent restaurants, including:

• Indian restaurants
• Italian restaurants and pizzerias
• Chinese and other Asian restaurants
• Mediterranean restaurants
• burger restaurants
• seafood restaurants
• vegetarian and vegan restaurants
• breakfast and brunch restaurants
• other independent restaurants

We don’t expect every restaurant within a particular cuisine to operate in the same way. An Indian restaurant using a tandoor, for example, can present a different risk from one using conventional gas or electric cooking equipment. The same applies to a pizzeria using a wood-fired oven rather than a conventional commercial pizza oven.

That’s why we ask about what you actually do rather than relying on the restaurant description alone.

Restaurant activities and cooking we can cover

Restaurants often combine several activities, and Suited can cover more than one business activity on the same policy where it falls within our appetite.

Depending on the restaurant, we can consider businesses that:

• serve alcohol with the appropriate licence or authorisation
• provide takeaway alongside restaurant dining
• sell food or other products online
• have a bar as part of the restaurant
• use commercial deep-fat fryers
• use tandoor ovens
• use pizza ovens, including certain solid-fuel ovens
• use grills, hobs and other commercial cooking equipment
• operate barbecues

Some of these activities bring additional risks, so we may ask further questions before offering cover. A restaurant using a large deep-fat fryer or solid-fuel oven, for example, raises different fire, extraction and maintenance considerations from one using relatively simple electric cooking equipment.

Who isn't restaurant insurance for?

There are also restaurants we may not be able to insure.

We expect restaurants to be properly run food businesses. That includes meeting applicable food hygiene requirements and using food and other products that comply with the relevant legal and industry standards.

A poor food hygiene rating may therefore fall outside our appetite. Restaurants with an extensive or concerning history of previous claims may also need to be referred to us or may not be something we can insure.

Similarly, insurance shouldn't be seen as a way of transferring the consequences of knowingly using unsafe, non-compliant or unsuitable products to an insurer. The food and products supplied by the restaurant need to meet the standards that apply to them.

If your restaurant has an unusual cooking method or activity and you're not sure whether we can cover it, please contact us before applying online.

What insurance does my restaurant need?

When we talk about restaurant business insurance, we prefer to start with the restaurant rather than the insurance.

Think first about the people and businesses you deal with: customers, employees, delivery drivers, suppliers and others. Then look at what you actually own or have invested in. Is the building yours? Have you paid for the kitchen or fit-out? What equipment and stock would you have to replace?

And finally, what would happen if you suddenly couldn't use the premises? A restaurant can survive the physical loss of an oven if it can replace it quickly; being unable to trade for several months is a rather different problem.

Those questions broadly lead us into liability, property and protecting the restaurant against the financial consequences of an interruption.

Restaurant liability insurance

We put liability near the top of the list because restaurants have several quite different relationships that can result in claims.

Customers spend time on your premises and eat the food you prepare. Employees work in the kitchen and front of house. Suppliers and delivery drivers come and go.

The circumstances of the claim – and who is making it – determine which type of liability insurance becomes relevant.

Public liability insurance for restaurants

Public liability insurance for restaurants covers claims against the business if someone is injured, or their property is damaged, because of your business activities.

A customer could fall on the stairs, trip in the dining area, be accidentally burned by something hot or have their belongings damaged. It doesn’t have to be a customer either – a delivery driver, contractor or another visitor could potentially make a claim.

Typically, restaurant public liability insurance – including the cover available through Suited – does not cover injuries to your employees. Employee injury claims belong under employers’ liability instead.

Nor is public liability designed to insure your own restaurant equipment, furniture or stock, or deal with contractual disputes.

One point we regularly draw customers’ attention to is that liability insurance and running safe premises go together. Policies generally expect businesses to take reasonable precautions, comply with relevant laws and safety requirements, maintain their premises and equipment and appropriately train their staff.

The insurance can respond to an insured claim; responsibility for running the restaurant safely remains with the business.

Products liability and food served by restaurants

Restaurants have a particularly important products liability exposure because they are usually preparing the food they supply rather than simply reselling a finished product.

Products liability insurance covers certain claims arising from food and drink supplied by the business. Food poisoning and allergic reactions are two obvious examples.

Allergens deserve particular attention in a restaurant kitchen. A single menu can involve many ingredients and recipes, sometimes prepared alongside each other, while ingredients and suppliers can change. Restaurants have legal responsibilities to provide accurate allergen information and manage allergens when preparing and selling food.

For us, there is an important line between insurance and those responsibilities. Products liability can deal with certain insured claims arising from food you have supplied; it doesn't make unsafe or non-compliant food insurable simply because a customer subsequently makes a claim.

There is another distinction worth understanding. Products liability is concerned with the product causing injury or damage, rather than the value of the product itself. Spoiled ingredients or food that simply has to be thrown away are different losses.

Product recall is separate again. If food needs to be withdrawn from sale or products already supplied need to be recalled, don't automatically assume those costs are covered by ordinary products liability insurance.

Employers’ liability insurance for restaurants

Restaurants can have large and varied teams: chefs, kitchen porters, waiting staff, bar staff and sometimes temporary or casual workers brought in for busy periods.

Employers’ liability insurance covers certain claims where an employee is injured or becomes ill because of their work. For most UK employers, it is compulsory.

The kitchen deserves particular attention. Staff may be working with knives, steam, hot surfaces, fryers, grills and heavy supplies, so suitable training and PPE need to form part of the restaurant's normal health and safety arrangements.

Casual or temporary staff shouldn't simply be ignored when arranging the insurance either. Where somebody works under the restaurant's direction and control, they may need to be treated as an employee even if they only work occasional shifts.

Employment circumstances differ, so if you're unsure whether employers’ liability is legally required, check the official GOV.UK guidance rather than relying on a general insurance page.

Commercial legal expenses for restaurants

Some of the problems a restaurant encounters will have nothing to do with an injury or damaged property.

There may be an employment matter, contractual disagreement, unpaid debt or a dispute concerning the premises.

Commercial legal expenses insurance can help with certain business legal disputes and associated legal costs, depending on the policy.

One limitation worth understanding is reasonable prospects of success. Legal expenses insurers will generally only fund a civil case where there is a better than even chance of achieving a successful outcome.

Each section of legal expenses cover also has its own conditions and exclusions, so the policy documents should be read carefully rather than assuming every employment, property or contractual dispute will be covered.

Why does restaurant cooking equipment matter to insurers?

The restaurant description tells us what you sell. The kitchen often tells us rather more about the physical risk.

A tandoor, wood-fired pizza oven, large deep-fat fryer and conventional electric oven don't create identical exposures. There can be differences in heat, naked flames or solid fuel, hot oil, ventilation and the amount of grease passing through extraction systems.

Real restaurant fires illustrate the point rather well.

London Fire Brigade has reported a restaurant fire where grease and fat deposits in extraction ducting ignited after charcoal was used in a tandoor oven. In another incident involving a wood-fired pizza oven, prolonged exposure to heat caused structural timber to ignite.

And extraction itself matters. Grease accumulating inside ducting can allow a relatively localised kitchen fire to spread much further through a building.

This is why we ask about cooking equipment, extraction and certain other kitchen features when you apply for restaurant insurance. We aren't simply interested in whether you serve Indian food or pizza; we need to understand how that food is actually being cooked.

What if my restaurant also has a bar or another business activity?

A restaurant doesn't necessarily have to be only a restaurant.

You may have a bar, offer takeaway or delivery, sell your own sauces or other products, or operate a small retail section from the same premises.

With Suited, you can combine a number of different business activities within one policy, provided they fall within our underwriting appetite. Tell us what the whole business does rather than choosing whichever single description seems closest.

If alcohol is part of the business, it needs to be declared, and you must have the appropriate licence or authorisation and comply with any conditions attached to it.

The same principle applies if the business changes later. If you add a new activity, you can update your policy online or contact us, and we'll help you make the change.

Protecting the restaurant premises

A restaurant can have a considerable amount of money tied up in one location. There is the building itself where you own it, but also the fit-out, commercial kitchen, furniture, equipment and stock.

Buildings insurance

If you own the restaurant building, commercial buildings insurance can protect the structure against specified causes of physical damage.

If you rent, the landlord will commonly insure the building, although the lease should be checked to establish where the respective responsibilities sit.

Tenants’ improvements, fixtures and fittings

Renting doesn't mean the landlord necessarily owns or insures everything you have put into the premises.

Flooring, counters, bars, lighting, plumbing, electrics, extraction and other permanent improvements may have been paid for by the restaurant owner.

Depending on the policy and the item concerned, these may fall within tenants’ improvements, fixtures and fittings or other property cover.

Contents and kitchen equipment

Commercial restaurant kitchens can contain ovens, ranges, grills, fryers, refrigeration, dishwashers, preparation equipment and plenty more.

Then there is the dining area, with its tables, chairs, tills and other contents.

Contents insurance is designed to protect business property against specified causes of physical loss or damage.

Restaurant stock

Restaurant stock can vary enormously.

Fresh meat, fish, vegetables and other ingredients may be relatively fast-moving and perishable. A restaurant with a substantial wine list or bar could have considerably more value sitting in wine, spirits and other alcohol.

Think about how much stock you could realistically have at risk at the busiest point of the year, rather than only what is normally sitting in the kitchen on an average weekday.

Perishable and refrigerated stock may also require particular attention because deterioration following refrigeration or power failure isn't necessarily treated in the same way as stock physically damaged by another insured event.

Buildings, tenants’ improvements, general contents and premises stock insurance aren't currently available through Suited's online quote journey, but we may be able to help arrange these covers separately.

Protecting the restaurant's financial position

The cost of repairing a damaged restaurant is only one side of a serious property loss.

If the premises can't open, the business may immediately start losing turnover while rent, wages and other expenses continue.

For a restaurant that depends on a particular location, that interruption can become a significant loss in its own right.

Business interruption insurance

Business interruption insurance can cover certain financial losses when insured damage to the premises prevents the restaurant from trading normally.

Property insurance deals with the insured physical damage. Business interruption looks at the resulting financial effect while the restaurant is unable to trade.

The cover is typically linked to insured damage affecting the premises rather than providing standalone protection against any reduction in turnover.

Increased cost of working

Sometimes the restaurant can reduce the interruption by spending additional money – perhaps hiring replacement equipment or temporarily operating elsewhere.

Increased cost of working can cover certain additional expenses incurred to keep the business operating or reduce the interruption, depending on the policy.

Premises insurance isn’t currently available online, but Suited can assist you. Please contact us if you are interested.

Does a restaurant need cyber insurance?

For some independent restaurants, cyber may be relatively low down the list of risks. For others, technology has become central to the business.

Online reservations, takeaway ordering, customer databases, loyalty schemes and dependence on digital till and payment systems can all create an exposure.

Cyber insurance can cover certain losses, liabilities and response costs following a cyber incident, depending on the policy.

Whilst cyber insurance isn’t currently available online, Suited can assist you. Please contact us if you are interested.

What do I need to be able to insure my restaurant?

Restaurants need to operate as properly registered and compliant food businesses.

That means meeting applicable food hygiene and allergen requirements, maintaining the premises and equipment appropriately and providing staff with suitable training.

The kitchen may bring additional insurer requirements. Deep-fat fryers, extraction systems, solid-fuel ovens and other commercial cooking equipment need to be properly installed, operated and maintained, with appropriate fire precautions in place.

If you sell alcohol, you must also have the appropriate authorisation and comply with the conditions attached to it.

Commercial restaurant insurance deals with unexpected insured claims and losses; it doesn't replace the responsibilities that come with running a restaurant safely and legally.