Business Insurance - Bar and Club

If you own a club or bar, your insurance must always be up to date and in compliance with local, state and federal laws. This is because any establishment that sells alcohol to the public is heavily regulated as it poses a potential risk to the community. Every business is required to have insurance, though this investment is designed to protect the business owner as much as the customers. Read on for more information about the types of insurance associated with bars and clubs.

Property, Alcohol and Entertainment

You must assess the replacement value of fixtures, décor, stock and equipment, as the value of the property on which the bar and club is situated. Décor in such bar and clubs is often a major expense, so it is wise to balance the value of any décor as this could affect your premiums.

Alcohol sales provide a large percentage of the total income of any bar or club. Once this percentage crosses 50 percent, insurers would consider it as a higher risk and raise premiums accordingly. You will have to provide evidence of such sales to the insurer, who can also ask for periodic verification.

Certain games in a bar and club (like pool) can cause an increase in premiums. Likewise, certain games (like darts) may even be excluded from coverage by some insurers, especially when they consider them unsafe or having dangerous equipment.

Employees, Patrons and Location

If your establishment has other employees, you must have mandatory forms of insurance, including worker’s compensation and other measures of protection. Owners must be especially careful of safety, health and hygiene laws in this regard.

Each state has its own laws regarding property damage caused by intoxicated patrons, and the state imposes certain liabilities on owners for any third party claims. Your claims provider will take state and local laws into account.

The location of the bar and club can dictate insurance premiums, especially if the property of the bar and club is located near the beach or any other location that is more exposed to the vagaries of nature.

Food, Vehicles and Emergencies

All products sold in the establishment—like liquor and food—can affect insurance premiums. Owners are also encouraged to cover themselves from any claims arising from injuries that can be caused by these products. You may not be granted a liquor license until you have proof of such liability insurance.

If your bar or club owns a vehicle, you must have commercial automobile insurance. This can also affect the overall premiums associated with your business.

One option you have is to buy coverage that will protect you during any business interruption. Premiums for such coverage may be expensive, but this can cover the owner from any interruption to business operations, whether the causes are natural or man-made. Each type of coverage will have its own premium depending on the risk perceived by the insurers or the likelihood of such events based on their experience in the area. In areas considered to have a certain level of risk, insurers may even have refuse to take the risk of such insurance.

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