The Role of Business Interruption Insurance for Hotels and Restaurants

Owning and operating a business in the hospitality industry can be lucrative, rewarding and enjoyable. However, these operations often include extensive risks and exposures, and even slight mishaps could have far-reaching financial ramifications. Accidents, errors or other unexpected situations that impede your business’s ability to operate as usual can be particularly consequential. At Koziura Szafranski Insurance Agency, we’re standing by to help you ensure these scenarios with ideal business interruption insurance.

What Does Business Interruption Insurance Cover?

Also known as business income insurance, these policies can help your company manage the financial ramifications of covered incidents, such as fires, vandalism and break-ins. This type of coverage is critical, as commercial property insurance can help pay to repair or restore damaged property. You’ll need business interruption coverage to manage the following costs and expenses:

• Reduced revenue

• Rent and mortgage payments

• Taxes

• Employee wages

• Temporary relocation costs

• Loan payments

Why Is Coverage Necessary for Hotels and Restaurants?

Restaurants and hotels may often project revenue based on various circumstances, including rushes during certain times of the year and nearby events that may bring more customers to your doorstep. Think about how the following scenarios could have dire financial ramifications if you were to lack business interruption insurance:

• Consider the possibility of a fire breaking out in your storeroom or kitchen. Flames could cause significant damage and make your restaurant temporarily uninhabitable. This could be particularly devastating if you depend on summer tourism and are forced to close during a busy weekend.

• Imagine your hotel’s lobby and common areas are vandalized. Criminals could force you to temporarily close while conducting repairs and restorations. During this time, you’d be unable to collect revenue from renting out rooms and may require financial aid to ensure you can resume operations smoothly.

We’re Here to Help

Contact Koziura Szafranski Insurance Agency in Newington, Connecticut, today to learn more about business interruption coverage and get a free quote.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.