Catering insurance is an essential part of any event planning. It covers you from unexpected events such as fire, theft, damage to property, etc.
But what if you are running a small business and want to cater to your own party? Do you need catering insurance?
In this post, I will explain why insurance for catering business is necessary and how it works.
What Is Catering Insurance?
It’s the policy that protects you against unforeseen circumstances while providing coverage for food preparation services. This includes:
- Food loss or spoilage due to natural causes
- Damage caused by pests
- Losses incurred during transportation
- Theft of equipment used in preparing meals
- Fire/explosion at your premises
- Accidental injury to employees
- Liability claims made on behalf of third parties who have been injured through negligence
How Does Caterer’s Insurance Work?
The basic premise behind caterers’ insurance is simple – when something goes wrong with your meal service, you will be compensated for losses sustained. The insurer pays out money based on the value of the lost goods and services. If there was no catering insurance, you would not get paid even though you had prepared all the food and served it to guests. You may also lose your reputation because people might think that you cannot handle things well.
So, let us look into some common scenarios where catering insurance can help you.
If Your Business Has Been Targeted By A Burglar
Burglars often target businesses like restaurants, cafés, bars, hotels, etc. They steal cash, valuables, computers, laptops, mobile phones, etc. In case they find anything valuable inside your restaurant, café, bar, hotel, etc., they take away everything, including furniture, appliances, cutlery, crockery, glasses, plates, cups, utensils, etc.
If you don’t have catering insurance, you won’t receive compensation for these items, which means you’ll lose more than just the amount of replacing those stolen items.
If There Was An Unforeseen Event Like Flood Or Earthquake
Floods and earthquakes cause major damages to buildings and infrastructure. These disasters affect both residential properties and commercial establishments.
When floods occur, water enters the building causing structural damage. Similarly, earthquake affects the foundation of the structure resulting in cracks and other damages.
When disaster strikes, you must quickly assess the situation and decide whether to continue operating or close down temporarily until repairs are completed. But before making any decision, you should check if you have adequate insurance coverage
If Someone Gets Hurt At Your Restaurant
You know accidents happen every day. Sometimes, injuries result from slips, trips, falls, burns, cuts, bruises, bites, scratches, etc.
When someone gets hurt at a business establishment, they usually file a claim against the owner. However, if the accident happened due to an employee being negligent, the employer could face legal action.
Catering insurance helps protect employers from such situations. It covers accidental injuries suffered by their staff members.
If Something Goes Wrong With the Transportation Of Goods To And From Restaurants
Sometimes, customers complain about the poor quality of food delivered to their homes. This happens due to transportation problems. For example, if the delivery truck breaks down somewhere along its route, it takes longer to reach the destination.
In this scenario, you need to pay extra charges to transport the food back home. Catering insurance compensates you for these additional costs incurred during transportation.
If Your Food Is Damaged Due To Natural Causes
Natural causes include fire, lightning strike, windstorm, hail storm, flood, drought, snowfall, tornadoes, hurricanes, volcanic eruption, tsunami, earthquake, landslide, mudslide, avalanche, explosion, riot, civil commotion, war, terrorist attack, sabotage, theft, vandalism, robbery, burglary, break-in, assault, kidnapping, ransom demand, medical malpractice, industrial injury, animal bite, insect sting.
These events can be covered under your catering insurance policy. You will get compensated for all losses caused by natural calamities.
If A Customer Complains About The Quality Of Service Provided By Your Staff Member
Your customer may not always appreciate what you do for them. They might even file or register a complaint with the authorities. When that happens, you’re left without any recourse.
However, when you have catering insurance, you can easily handle complaints made by your clients.
If An Employee Leaves Without Paying Their Bills
If one of your employees leaves his job without paying his bills, then you’ll lose money. In addition, you also risk losing a good reputation among your clientele.
This problem can be solved through catering insurance. It protects you from financial loss arising out of unpaid wages.
If Your Business Has Been Closed Down Because Of Unavoidable Reasons
Small Businesses often shut down because they cannot afford to operate them anymore. They fail to make enough profit to cover expenses.
For instance, restaurants sometimes go bankrupt after serving too many meals in a row. Other businesses close down because they lack sufficient capital to keep going.
The closure of your restaurant can cause serious damage to your image. So, you need to take measures to prevent this from happening. One way to achieve this goal is to buy catering insurance.
If You Are Unable To Serve Customers On Time
They are likely to leave and find another place where they can enjoy better service.
When you don’t serve people on time, you end up incurring penalties as well. These fines could cost you thousands of dollars per day.
To avoid getting penalized, you must ensure that your business runs smoothly at all times. That’s why you need catering insurance.
If You Have Too Many Employees
Having more than five or six staff members working together is quite common nowadays. However, it doesn’t mean that you should hire everyone who applies for a position.
It would be wise if you only employ those individuals you think are capable of handling their duties efficiently. This ensures that you won’t waste resources unnecessarily.