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What Hospitality Insurance Covers
Hospitality insurance covers the premises, the kitchen, the stock and the liability of a business that feeds, serves or accommodates the public: restaurants, cafes, bars, hotels, caterers, takeaway and delivery operators, short stay accommodation and the food producers who supply them. It is a package of sections sized to how the venue trades.
The risks are wide because the public is on the premises. A customer slips, is burnt or has an allergic reaction, and a public or products liability claim follows. Open flame, gas and heavy electrical equipment make kitchen fire the loss that closes venues. A failed cool room spoils stock over a weekend. A liquor licence brings its own liability, and events and function rooms bring crowds.
Licensed venues carry conditions under their liquor licence, and every food business must comply with the Food Standards Code, which insurers check when a food claim is lodged. Most landlords require public liability insurance before the keys change hands. When a fire or flood closes the doors, business interruption insurance pays the rent, the wages and the lost gross profit for the months it takes to reopen.
Fortis Risk Solutions arranges hospitality insurance for venues across Australia from offices in Box Hill and Hawthorn, as part of our business insurance range. We look at the menu, the cooking method, the trading hours, the licence and the lease before going to insurers. Dedicated packages exist for restaurant insurance and for cafe and bakery insurance; this page covers the wider group.
Who this covers
Each hospitality business carries the same base and a different emphasis. The notes below show where the risk sits for each type.
Restaurants
A full kitchen, table service, late trade and often a liquor licence. Kitchen fire, patron injury, food-related claims and spoilage are the usual losses, and business interruption carries the venue through the rebuild. The restaurant insurance page sets out the package.
Cafes and bakeries
Daytime trade, ovens running from early morning, coffee machines and footpath tables. Machinery breakdown, deterioration of stock, glass and public liability do the work. The cafe and bakery insurance page covers the detail, including footpath trading permits.
Bars and nightclubs
Alcohol, crowds and late hours. Liquor liability is the section standard public liability wordings leave out, and insurers rate security staff, responsible service training and the incident record against the licence. Glass, fit-out, money and assault-related claims round out the package.
Hotels and accommodation
Guest rooms, common areas, food and beverage and events under one roof. Guest property, guest injury, liquor and business interruption set on room revenue are the core, alongside the building if owned and the fit-out if leased. Short stay apartments sit between landlord and hospitality cover.
Hospitality groups and franchises
Several venues, a central kitchen and franchisees. One group program with per-venue schedules keeps every site at the same standard and satisfies each lease, and management liability protects the franchisor for employment, safety and regulatory claims across the group.
Food delivery businesses
Vehicles and riders on the road, food in transit and customer data on an app. Commercial motor with business use, goods in transit with food spoilage, public liability extended off the premises and cyber cover for the ordering platform are the sections to check.
Catering services
Food prepared in one place and served in another. Liability has to extend to every venue, equipment cover has to travel, and deterioration of stock has to include food in vans and at the event. Event cancellation can be added for large functions.
Fast food and takeaway businesses
High volume, deep fryers, delivery and casual staff. Fire from fryers and flues, slips, food claims and employment disputes are the usual claims. Property, liability, business interruption and management liability cover them, and the cleaning records matter at claim time.
Resorts and short term accommodation
Guests on site around the clock, pools, activities and remote locations. Public liability for guests and activities, property for the buildings and contents, business interruption for lost bookings and, for owners of individual short stay properties, a landlord wording that allows short term letting.
Food manufacturing and processing
A food producer carries products liability for what leaves the plant, recall costs if a batch comes back, machinery breakdown on the lines and spoilage of raw materials. The manufacturing insurance package with food sections added is the usual home.
Food wholesalers and suppliers
Cool rooms, delivery fleets and trade customers. Deterioration of stock, goods in transit with spoilage, commercial motor, products liability and business interruption do the work, and the stock sum insured should match the busiest week.
Hospitality Insurance: Cover Sections and Benefits
Hospitality Insurance FAQs
Public and products liability first, because landlords, councils and event organisers ask for it and because patron injury and food claims are the most common. Then a business insurance package for the fit-out, equipment, stock and glass, with business interruption added. Licensed venues add liquor liability. Workers compensation is compulsory for every employer and sits in a separate policy.
Only where the liquor liability section is included and the licence is disclosed. Standard public liability wordings often exclude or limit claims connected with the sale or service of alcohol, so a bar, a licensed restaurant or a function venue needs the section written in. Insurers will ask about responsible service of alcohol training, security on late nights and any incidents recorded against the licence.
Accommodation adds guest property, guest injury in rooms and common areas, and the loss of bookings after damage. The building is insured by its owner, the operator insures the fit-out, contents and liability, and business interruption is set on room revenue rather than food sales. Short stay apartments sit between landlord insurance and hospitality cover, and the wording has to say which applies.
Only if the policy says so. Liability cover needs to extend to events at other venues, and property cover to equipment in transit and on site. Vehicles used for catering or delivery need commercial motor insurance, because a business package does not cover a vehicle on the road and a private policy usually excludes business use. Food kept in the van needs a deterioration of stock section with transit included.
A food producer carries hospitality and manufacturing exposures at once: products liability for what leaves the factory, recall costs if a batch has to come back, machinery breakdown on production lines and spoilage of raw materials. Businesses with production plant usually need the manufacturing insurance package with food sections added, and FRS places them that way.
Hospitality wordings differ in the conditions that decide claims: flue and canopy cleaning intervals, deep fryer rules, spoilage triggers, liquor wording and the indemnity period for lost income. FRS helps you disclose the kitchen, the licence and the trading hours accurately, structure sums insured for fit-out and stock, compare specialist hospitality insurers and act as your advocate at claim time.
Related pages
Dedicated pages in this group: Restaurant Insurance, Cafe and Bakery Insurance, Hotel and Hospitality Property Insurance
Related industry groups: Retail and Consumer Insurance, Events and Entertainment Insurance, Factory and Manufacturing Insurance
Talk to a broker about Hospitality and Tourism Insurance
Call 03 7046 3766 on weekdays between 9:30am and 6pm, email admin@fortisrisksolutions.com.au, or send an enquiry and a broker from our Box Hill or Hawthorn office will come back to you about hospitality and tourism insurance. Tell us what the business does and what the lease or contract asks for, and we take it from there.