Bar Insurance –Obtaining an Insurance Quote is one of the main considerations as part of the start-up process of running a wine bar or public house business. Insurance for your bar or wine bar, is an important consideration for any new or existing business, bars come in all shapes and sizes and are gaining in popularity over other types of licence premises. There is a fine line between what constitutes a public house and what is a bar, after all, they both serve alcohol, apart from the obvious marketing reasons and the fact that public houses, tend to occupy purposes built buildings, the differences can be quite subtle. Whereas, the more traditional public house, tends to focus on beers and to a lesser extent spirits, with perhaps the addition of ‘pub grub’, bars will serve more bottled beer, wine and perhaps even cocktails but generally be unable to offer you more than a range of snacks or bar foods. The real difference, is in the diversity of what bars can offer, take a walk down any high street now and you will find bars opening in a wide range of buildings, sometimes within other buildings, some will be quiet and relaxed where you can sit down and relax and perhaps listen to music, others will be bright brash and noisy.
Although the types of bar can vary immensely, they are all likely to be at risk from very similar insurance perils. Bar insurance can be purchased on a package basis, and the insurers will ask certain questions to gain a good understanding of how the business operates in order to calculate an insurance premium. It’s very important for insurance purposes, to have a good understand of the perils your bar can face as is disclosing all of the activities and events that are carried out to ensure that the correct cover is received. Insurers have designed their bar insurance policies to cover a wide range of typical eventualities that a bar can be affected by. Some are more important that others, some sections of the insurance policy will be compulsory, others you will be able to pick and choose from.
Building Insurance for a Bar
a larger proportion of bars occupy rented or leased premises, and in these cases, the building insurance is provided by the landlord and the premium is requested via the service charges. In the case of multi-occupancy buildings, the premium is divided up amongst all of the tenants. You should still be entitled to have sight of the policy booklet and remember to ask for full details of you make a claim. This is very important as insurance claims for such things as fires & floods, tend to happen at the most inopportune moments and it’s important for you to know the correct procedure for reporting acclaim with the freeholder especially if it happens out of normal business hours. If you do need to arrange your own building insurance, a full list of the activities will be required by the insurance company as will details of the constructional and age of the property along with it’s post code and rebuilding sum insured. If any catering is carried out at the premises, there will be certain conditions and warranties relating to the cleaning and the maintenance of the equipment that you use. The perils that will be offered to you will be fairly similar to a standard building insurance policy. If you have mortgage on the property, remember to ask to have your lenders name mentioned on the policy. This policy section will usually have an excess, this does vary but for a bar insurance policy, £250.00 is a fairly typical amount.
Contents Bar Insurancethis is one of the most important sections of the bar insurance policy as it covers your most tangible assets, goods that have probably resulted in your biggest outlay and possibly, depending on your bars location, the biggest risk from damage caused by floods, fires & thefts. The section is normally sub divided in several categories. You may have to supply separate sum insured for the following: Trade contents, these are your tables and chairs and seating including equipment, either that you own or are responsible for. Tenants Improvements, these are items that you have added to the premises that have’ improved’ the property but which you remain responsible for, these can include such things are signs & partitioning. Stock, this may be divided between the high risk items, such as wines & spirits, beers ( both bottled and on draught) and them food stuffs, either for sale or preparation.
Two important factors to remember, if you are renting your premises, make a list of all the items that are supplied with your premises and seek clarification if you are responsible for the insurance. Much rented and leased equipments, such as electronic tills or point of sale equipment will require you to effect insurance, with the owners interest noted. You will need to know the replacement cost of your stock as well. When you have calculated your total sum insured, your insurers will use it to help calculate the premium. The premium will depend on a number of factors such as location. Depending on the sums insured requested and other factors such as the total value of all high value stock on the premises, you may find that you are asked to increase security at the premises. This should be discussed carefully with the insurers and the landlord if it effects his property.
Loss of Income Bar Insurancepossibly, even more important than the above section, this cover, also know as Business Interruption insurance, will protect you in the event that your trade is disrupted following an occurrence of an insured peril at your premises. It may be possible to replace stock and contents quite cheaply but even a bar with low sums insured, can turnover a large amount of money, with the corresponding loss of income if trading is not possible or restricted. Many bar owners do not give this section a second thought, it’s easy to imagine a fire or a flood, but some bar owners wrongly think that any fall in income would have to be borne by the business. In fact, many business would not be able to withstand a fall in profits for any length of time, some costs are fixed and may continue even if the business is not operating. A calculation may be required to work out your sum insured and an indemnity period of twelve months is usual, although in some cases, this may be extended. Sometimes, the insurer will simply give you a sum insured and for most small outfits, this is usually perfectly adequate.
Licence Protection Bar Insurance without your alcohol licence, the business will be pretty much finished and this section of the bar insurance policy will help to protect you against this. Licences, can be lost for a variety of reasons and in many cases, they can be reinstated on appeal. If this is not possible, then the value of the building may be compromised. Cover is available for both of these eventualities and the sum insured is usually chosen by the insurer. If any event arises, that is likely to compromise the renewal of a licence, then the insurance company will want to know as soon as possible. Failure to keep them informed of developments, may result in cover being declared void.
Liability Insurance Under a bar insurance policy, liability is usually divided in to three sections.
- Public Liability Insurance
- Products Liability Insurance
- Employers Liability Insurance
The first two, will cover you against sums you are legally required to pay as a result of accident or injury to persons occurring on your premises. This also includes damage to their belongings or food poisoning. Some times, bars are asked to operate a facility away from the premises, this can include running a bar at a special event or even catering for a function. This will involve additional risk and it’s important that you check with the insurance company, that they are happy to provide the extra cover. A sum insured of £2,000,000 is fairly typical. If you have any employees, you will need Employers Liability Insurance. It is one of the few insurances in the United Kingdom that are required by law. If you do not have this cover, they you will be trading illegally. The law has made the definition of an employee to be as broad as possible, in essence if you have persons, working on your premises for your business, employed or not, then you will require cover. The law also states, you will need to display a certificate of employers liability insurance, in a prominent position, where all employees can see it.
Money most bars are a cash business and this cash will need to be stored and then taken to the bank. This section will provide against loss of money, with of course, theft being the biggest risk. Cover is available whilst money is on the premises( there are different sums insured for over night) and whilst in transit to and from the bank. As most of the sums insured will be provided by the insurance company, you will need to make sure, these are adequate for your needs. Do you have any trading periods where the limits for money will be breached? The insurers may want to know the make of safe you are using and it’s rating. Depending on the amount of money, you are handling, there may be different rules for the way it is transported to the bank, make sure you read the terms and conditions of your bar insurance policy carefully.
Breakage of Glassthis section of the policy covers you against breakage of glass at your premises. Glass is expensive, and if you add on the cost of the frame work and temporary boarding up, it comes to a fair amount of money. If you are renting your bar premises, you should examine the terms of your lease carefully, you will probably find that you are responsible to insure the glass in the building. Cover will include plate glass and shelving. Always check on the replacement cost of glass and make sure your sum insured is adequate. As well as the above, there are a number of minor sections to the policy which will cover you against : Assault & Personal Accident and Book Debts If legal expenses is offered, this can be a worthwhile addition.