Business owners know and fully accept the risks involved in setting up a shop- and even more so if they are managing hotels and lodging. Not many realize that there are several insurance options they can choose from.
As an insurance broker, it is your responsibility to make sure your clients know what they are and help them to make a smart choice. Choosing an insurance coverage that best suits their needs is a must to run their hotel and lodging business worry-free.
Top 5 Insurance Coverages
Here are the top 5 Insurance options your clients might need:
1. Property Insurance
Having a Commercial Package Policy Insurance is necessary for all lodging establishments. It protects them from possible losses brought by building or content damages. Insurance providers often offer policies specific to the needs of small ins, motels, and other similar establishments. You’ll see them written on business owner forms. You’ll also find other coverages that a lodging business owner might need on the form as well.
2. Liability Insurance
A general liability insurance policy defends the business against claims on bodily injury, property damage or advertising or personal injuries caused by guests or other third parties. The size of their lodging business may also influence the number of incidents that can occur. For example, if they have a pool in the area, then drowning incidents are a possibility.
There are also types of incidents that may happen regardless of how large or small the establishment is – slips in the toilet and bath, food poisoning, etc. Having a general liability coverage protects them from such claims.
3. Innkeeper’s Legal Liability
Laws concerning this often vary between states. Depending on the state, the innkeeper may be held liable for any claims concerning damage, theft, and loss. Your clients must do thorough research to find out what the law dictates and protect themselves accordingly.
4. Commercial Auto Insurance
Advise your client to get commercial auto insurance if they use vehicles for business. A personal policy won’t cut it. There are several exclusions, and they won’t get maximum protection. On the other hand, having commercial auto insurance coverage won’t impose an auto liability limit for business-related operations.
5. Catastrophic Risks
This type of policy is a must for states prone to experiencing floods, earthquakes, volcanic eruptions, or mudflow. Your clients get to choose a specific policy depending on what type of risks they are regularly exposed to.
If your client is prone to floods, you can recommend that they add flood insurance. If they are prone to earthquakes, then they should add earthquake coverage to their policy.
Commercial Umbrella and Cyber Liability
On top of the ones mentioned already, your clients should also consider getting commercial umbrella and cyber liability insurance. What’s great about having commercial umbrella insurance is that it sits on top of any general liability coverage your client may already have. Generally, anything that the general liability coverage would not cover, the umbrella policy will take care of it once the original policy limits are exceeded.
Cyber liability insurance, on the other hand, comes in handy when dealing with electronic data. As a lodging establishment, it is likely that your client capture collects customer information. The information may include crucial data such as their credit card number, address, social security number, etc. If a cyber-attack ever occurs, a hacker can access this information and release it over the internet. The guests may opt to file a suit against your client for failing to keep their data protected. Cyber liability insurance will keep them protected against such claims.
As long as they offer liquor in the establishment, they better sign up for liquor liability coverage. Opting to pay an extra premium can be added to general liability or package policy.
Workers’ Compensation Insurance
The law demands that any lodging business that employs workers should have this type of insurance policy. It won’t be difficult since a lot of insurance providers offer this.
Hotels and Lodging owners have unique challenges and risks they face regularly. It is critical that they clearly understand their options so that they may choose one that truly fits their business needs.
About Snyder Specialty
Snyder Specialty, LLC is a New York-based underwriting facility that provides a range of property and liability solutions for personal and commercial lines. Specializing in coastal properties and hard-to-place risks, Snyder Specialty expands your current capabilities with proven solutions for complex risks. Find out more about the company’s range of services by calling (718) 362-8039.