Why restaurant and hotel property insurance is essential.

This article was originally published on August 20, 2024.

Restaurants and hotels are busy places. Customers are always coming and going. Vendors and service providers are frequently onsite. Employees are doing their jobs. Plus, incidents like fires and natural disasters can occur at any time, so it’s no surprise that property damage can be a major problem for hospitality businesses.

With adequate insurance coverage, hospitality businesses can manage property-related incidents without them creating significant financial burdens. Companies that don’t have the right insurance can experience devastating economic consequences following an unexpected event.

This article describes the essential elements of restaurant property insurance and hotel property insurance. It also explains that a THREE policy includes restaurant and hotel property insurance - along with other coverages - to address the most common issues these businesses face.

What’s covered by hotel and restaurant property insurance?

If you own or operate a hotel or restaurant, it doesn’t take long to understand that the list of property-related issues your business must contend with is long and includes:

• Fire from kitchen incidents, electrical problems, and other causes

• Damage from natural disasters, such as windstorms, floods, hail, lightning, earthquakes, etc.

• Vandalism and “malicious mischief,” like broken windows, damaged furniture, and graffiti

• Theft of company property, such as electronics, equipment, tools, etc.

• Accidental damage to guest property, such as luggage or personal belongings.

• Food spoilage due to power failures caused by a storm

The issues above are typically covered by most business insurance policies. Other issues can be addressed with specialized coverages. Equipment breakdown is a good example. This additional insurance can cover repairing or replacing commercial kitchen equipment, HVAC systems, or laundry equipment due to catastrophic mechanical failure (not normal wear-and-tear).

Remember that hotel or restaurant property insurance has coverage limits. You’ll have to pay any costs over your limits.

How THREE protects hospitality businesses.

Our business insurance policy at THREE is clear and concise about what’s covered. Some of the property-related provisions include the following:

• Loss of or damage to company property: THREE protects your business from theft and physical damage to property your business owns or leases. For example, if a grease fire spreads to the walls and ceiling in your kitchen, the incident may be covered. We pay to repair the damaged property if possible or replace it with something of similar qualities.

• Business interruption: We cover costs related to keeping your business running after a loss we pay, including lost net income. These amounts are called business interruption costs, and we cover them until your business resumes normal operations or you reach your business interruption coverage limit. For instance, the associated costs may be covered if a broken pipe floods your business office and you have to operate from a rented space nearby until workers complete repairs.

• Data damage: If a hacker gains access to your network and causes damage, you’re covered with THREE. Electronic data is considered a type of covered physical property.

• Loss of or damage to others’ property: THREE pays for incidents affecting property in your company’s care, custody, or control. For instance, if you agree to store a customer’s luggage until their transportation arrives and someone accidentally damages it and its contents, the repair or replacement costs may be paid under your policy.

As you can see, our policy covers most incidents a hospitality business is likely to face.

Understanding exclusions in hotel and restaurant insurance.

Exclusions are incidents or items that an insurance policy doesn’t cover. They’re standard in the business insurance industry.

Property and building exclusions for hotels and restaurants include:

• Occurrences that start or take place outside the policy period

• Ordinary property wear and tear

• Lost or misplaced property

• Anything personal to you (or anyone) independent of your business

• Any building your business owns, leases, occupies, or rents that isn’t listed on the policy

• Any vehicle owned or leased by your business (or any of its owners or officers) that isn’t listed

• Damage or business interruption caused by pollution, asbestos, or a nuclear event

This is a brief summary of exclusions. It’s not an exhaustive list of what’s covered and not covered by a THREE policy—or any insurance policy.

What does hotel and restaurant property insurance cost?

Your hotel or restaurant property insurance cost will depend on factors like your location, the size of your business, your claims history, and more.

Find out what you can expect to pay by getting a convenient online quote now. With THREE you'll get all the coverage most restaurants or hotels need in a single policy.

If you have specific questions - about restaurant fire insurance, hotel room damage insurance, or any type of coverage - you should talk with one of our licensed business advisors at 1-800-507-4495. They’re happy to help you understand the specifics of our policy.

Why hotel and restaurant owners and managers rely on THREE.

Every day, hotel and restaurant owners purchase insurance from THREE. Whether they’re launching a new business or looking to move away from the confusion of multiple policies and get whole-business protection, they find we’ve got the right business insurance for their needs.

Several factors make us an excellent choice for hotels and restaurants, including:

A single, whole-business THREE policy eliminates the confusion of having multiple policies and means one bill to pay, one number to call for claims and only one quote to get today.

THREE covers specific risks hotel and restaurant owners face. Other insurers may not.

Having a THREE policy can help ensure uninterrupted operations in the face of property damage or other costly incidents. That’s reassuring for hotel and restaurant owners and decision-makers.

Protect your hotel or restaurant with comprehensive coverage from THREE.

From tools and equipment to buildings, insurance for hotels and restaurants needs to protect essential property. A THREE policy includes all the coverage most hotels and restaurants need. Costly incidents can occur at any time, so it’s essential to get covered today and ensure you don’t have insurance gaps going forward!