Hotel-Insurance-Part 2

continued Hotel Insurance Information

If you are looking around for a comprehensive quote for a hotels insurance policy online, please take a few minutes to read our guide to Hotels Insurance for UK hoteliers… The main sections covered on a traditional UK hotels insurance policy, will also include the following:-

5) Personal Accident &  Assault – this section of the hotels insurance policy can provide cover for the proprietor, directors and employees if needed if they are killed or injured as a result of a a theft or attempted theft in or around the insured premises. The amounts payable are usually fixed in units, with each unit offering a certain amount of cover ( £1000.00 per unit  is a fairly typical amount as a capital benefit) There are smaller sums for temporary partial disablement and sometimes a benefit is included for damage to clothing and personal effects.  It may also be possible to obtain a stand alone section for Personal Accident to include injuries not caused by assault. This is of course separate from any cover afforded under the employers liability section. Again the cover under this, will be provided on a unit basis.  If you have a large number of employees, it may be possible to obtain cover on an unnamed basis.

6) Breakage of Glass –glass frontages, can be expensive to replace and both plain and plate glass can be covered by your hotelier policy.  The cover will extend to include internal doors and shelving. There is usually a limit for any one event and the cost of frame repair and boarding up is also included. If you rent your hotel, you may find that the landlord will expect you to insure for damage to glass under your hoteliers combined insurance policy. It is important that you cheque who is covering the glass, do not assume it will be the landlord.

7) Goods in Transit – most hoteliers will make a number of  regular trips to the cash and carry and various other establishments to obtain supplies for the business. In some cases, especially if alcohol is being carried, a load can amount to a tidy sum of money. Goods in Transit Insurance will help protect you you against losses occurring on your journey, there is a limit to how much can be claimed and there are exclusions relating to unattended vehicles both during the day and night time. Cover will be provided for both damage and loss. (Theft)

8)Loss of Licence – for many hotel owners, the ability to serve drinks, either with meals or on it’s own is a big advantage and may form a core part of their business. Some hotels have established restaurants and bars which contribute a good deal to the establishments takings. Larger hotels, often specialise in corporate events or weddings where the   loss of a licence could have a severe effect on bookings and may require the hotel to alter it’s business plan. Cover for loss of the hotels licence is available, forfeited under the provisions of the appropriate legislation governing such licences, a refused renewal of a licence is also covered. Like other sections of the hotels insurance policy, there are special terms and conditions for this section and the hotelier will be obliged to keep the insurance company informed if any complaints are received or any other event occurs which is likely to have a bearing on any licence application or renewal.

9)Deterioration of Stock – this section of the policy will cover you against frozen foods that have become spoiled as a result of an insured event. This is usually  as a result of mechanical or electrical breakdown of the refrigeration plant or by the accidental switching off of the equipment. Claims will not be paid if the power supply has been deliberately  stopped by the utility company for non payment of a bill or other reason. To obtain cover, all refrigerating plant will have to be under a certain age and maintained and records kept of the maintenance,  a valid maintenance contract will also hav e to be kept in force for the duration of the cover.

10)Tenants Liability – f you rent your hotel, then you may be legally  responsible for damage cause to the fabric of the building, cover supplied is usually restricted to a small percentage of the stock sum insured.

11) Liabilities – this is one of the more important sections of the policy wording and although claims made under the liability section of a hotel policy, do not happen that frequently, they can some times be fairly large. The section is usually divided in to, two or three sub sections:-

1- public liability 2- Products Liability 3- Employers Liability

Public Liability and Products Liability will provide the hotelier with cover for all sums they are legally required to pay (including costs)  against accidental injury or  damage to property. There is usually an indemnity limit (The total amount that the insurer will pay for any one event or series of events) £2,000,000 is a fairly typical sum insured on top of this and subject to agreement, the insurance company will also pay costs.  These first two covers will protect the hotelier against such occurrences as a guest injuring themselves on the premises and will extend to the supply of goods such as food, thus protecting the hotel owner against claims from food poisoning etc. There are a number of extensions that can be included as optional extras such as sudden & identified pollution,  car park liability & wrongful arrest. Another extension deals with the loss of hotel guests belongings.

Unfortunately, there are odd occasions when crimes are committed on the hotel premises resulting in the loss of guests personal effects. Hotel owners are not responsible for crimes although they are responsible to make sure that guests belongings are made as secure as possible during their stay at the hotel. Most travellers will have cover under their own home insurance policy for loss or damage to personal belongings, sensitive handling will be required of any loss or damage reported to the hotel owner.

A copy of The Hotel Proprietors Act 1956 should be displayed in the reception area (or as near as possible) although some proprietors also choose to display the notice in guests rooms. The display of this notice is  a condition of most hotels Insurance policies This act outlines the rights and liabilities of Innkeepers and  states that  providing sleeping accommodation has been provided for the guest, then where the proprietor is liable as an innkeeper to make good loss or damage to property brought on to the hotel premises, then his liability to any one guest should not exceed £50.00 or £100.00 in aggregate.

A hotel insurance policy will usually indemnity a policyholder for the above amounts ( subject to excess) providing of course they the hotel has taken all reasonable steps to prevent loss( such as making sure that the locks on the rooms  are in full working order. A hotel insurance, can be extended to include wider cover for guests effects that are specifically offered for safe keeping  and are deposited in to a safe that has been approved by the insurance company. A receipt must be given in exchange for each item which must be produced when the belongings are exchanged. The safe must be kept locked at all times with the keys held by the hotel owner or an authorised person. ( if they are left in a room, the proprietor or authorised person must be present at all times) They can of course be removed from the premises. There are various limits imposed by the insurers, in many cases it will be dependent on the rating of the safe installed at the premises.

Employers Liability cover, is one of the few compulsory insurances in the United Kingdom. The Employers Liability protection act1969 has deliberately made the definition of an employee as wide as possible so that most persons carrying out some form of work, be they paid or voluntary, will fall under it’s protection.. There are minimum amounts that you can insure for, and these will usually be the amount offered by the insurer. The limit for indemnity is usually set at £10,000,000. Most hotel insurance polices will assume that the majority of the employees work is carried out in and around the confines of the building. In some cases, work away from the premises may be undertaken and this should always be pointed out to the insurer, to ensure full cover is provided.

12) Book Debts – most policies will now include a  sum insured for book debts although it is no longer a cover that many hoteliers would choose voluntarily, especially if they have good accounting records in place ( this has been made much easier with modern computer storage systems) In essence, cover is provided in the event that the hoteliers book of debts is damaged by an insured perils and it cannot be proven where the debts originated from. This type of cover does not apply to many hotel owners who operate on a pay as you stay basis.

13) Theft by Employee – sometimes also known as Fidelity Insurance, It is possible to effect cover under a hotel insurance policy for the above although many hoteliers prefer not to make a claim for such events.   Cover will include both loss of money and for other property belonging to the hotel subject to discovery being made within certain time scales and within a set period  of the employee leaving employment. The dishonest employee will have to be identified to the insurance company.

14) Legal Advice – a recent and very valuable addition to a hotelier insurance policy has been the legal advice section, where the insurance company ( usually via an outsourced company) will provide free legal advice to the hotelier, 24 hours a day, on any commercial legal matter relating to the running of the business. All calls are recorded to help monitor standards, The advise provided is confidential and will be in line with the laws of the European Union, Switzerland, The Channel Islands, The isle of Man and Norway.

The above sections make up the bulk of the risks that a hotelier can protect his or her business against. As with all insurance, each section will have it’s own terms and conditions and excess.. There will be different sum insured for each section and whilst most hotels will need to protect themselves against similar risks, each hotels needs and requirements are different. This is a fairly complex insurance product and one that will need to be discussed with an underwriter that is experienced in the risks faced by a hotel business,  in order that a full appreciation of the cover required can be obtained. Some sections of a hotel insurance policy are compulsory whilst others are available on a voluntary basis, in return for an additional premium. Full disclosure of all material facts must be made to the insurers to  ensure that your quotation is as accurate as possible. Failure to disclose material facts may result in you not receiving the cover you require. If you are in any doubt as to  what constitutes a material fact, this can be explained to you.