Is Your Restaurant Insurance Still Serving You Right? Key Tips Before You Renew

06 Aug Is Your Restaurant Insurance Still Serving You Right? Key Tips Before You Renew

Running a successful restaurant is about more than just delicious food and great service, it’s also about managing risks. From kitchen fires to slip-and-fall injuries, the restaurant industry faces unique exposures that require specialized insurance. As your renewal date approaches, it’s the perfect time to ask: Is your current restaurant insurance policy still protecting your business the way it should?

At Kevin S. Dougherty Insurance Agency Ltd., we help restaurant owners across Illinois and beyond make informed decisions about their coverage. Whether you operate a fine dining establishment, café, or franchise, here’s what you need to consider before signing that renewal document.

1. Has Your Business Changed in the Last Year?
   Restaurants are dynamic businesses. Maybe you’ve expanded your seating area, started offering delivery services, added alcohol to the menu, or invested in new equipment. These changes can impact your risk profile and your insurance needs.
   For example, adding alcohol service may require liquor liability coverage, which protects your business from claims related to intoxicated patrons. Similarly, delivery operations could mean you need commercial auto insurance even if your drivers use personal vehicles.
   Tip: Always inform your insurance agent about any business updates before your renewal.
2. Is Your Coverage Limit Adequate?
   One of the biggest mistakes restaurant owners make is underinsuring their property or liability exposures. Inflation and supply chain issues have driven up the cost of materials and labor, meaning your current coverage limits may not be enough to replace or repair damaged property.
   According to the U.S. Bureau of Labor Statistics, food service industry prices have seen a consistent increase since 2020, which directly impacts your operating costs and potential losses. Use this time to reassess your property, general liability, and business interruption coverage.
3. Have You Reviewed Workers’ Compensation and EPLI?
   Workplace injuries and employee-related lawsuits are common in the hospitality sector. Burns, cuts, slips, and harassment claims can put your business at risk.
   Ensure your workers’ compensation insurance reflects current payroll figures and job roles. Also, consider Employment Practices Liability Insurance (EPLI) to protect against wrongful termination, discrimination, or wage disputes.
   The National Restaurant Association notes that employee claims are one of the top reasons small restaurants face legal action. EPLI may not be part of your standard policy, but it’s an essential add-on in today’s litigious climate.
4. Are You Taking Advantage of Policy Bundling or Discounts?
   Many insurers offer Business Owner’s Policies (BOPs) that bundle general liability, property, and business interruption insurance—often at a lower premium than purchasing each separately. Ask your agent if bundling or reviewing policy overlaps could save you money without compromising coverage.
   Additionally, implementing safety protocols, like regular fire inspections or food safety training, could make your business eligible for insurance discounts.
5. Are You Working with an Independent Agent?
   Unlike captive agents who represent a single insurance carrier, independent agencies like ours work with multiple providers to find the best coverage at the most competitive price. We act in your best interest, not the insurer’s.
   That means when renewal time rolls around, we can shop your policy across multiple carriers to ensure you’re not overpaying or missing critical coverage.

Ready to Renew with Confidence?

At Kevin S. Dougherty Insurance Agency Ltd., we don’t just check boxes, we build customized insurance solutions that fit the specific needs of your restaurant. Before your next renewal, let us evaluate your policy for gaps, opportunities, and better options.

Contact us today for a no-obligation restaurant insurance review. You can also call us directly at (630) 575-0800.

FAQs About Restaurant Insurance Renewal

1. How often should I review my restaurant insurance policy?
   Ideally, you should review your policy at least once a year—especially before renewal. However, major changes like expansion, adding services, or buying new equipment warrant a mid-term review.
2. What types of insurance should every restaurant carry?
   At minimum: General liability, commercial property, business interruption, workers’ compensation, and (if applicable) liquor liability and commercial auto insurance.
3. Can I switch carriers at renewal time?
   Absolutely. Renewal is the best time to compare quotes from different carriers and find a better rate or more suitable coverage. An independent agent can help with this process.
4. What happens if my coverage limits are too low?
   If your policy doesn’t fully cover the cost of a claim or loss, you’ll have to pay the difference out of pocket. This can be financially devastating, especially in the case of major property damage or a lawsuit.