Hospitality Industry Insurance Risks: Hotel & Restaurant Owners Must Review And Update Insurance Coverage To Protect Their Businesses

•  Proper insurance to value (ITV). The market sometimes offers blanket and agreed amount limits, which can help buyers overcome an instance where the insured has purchased too little building coverage.
•  Business income limits. Most insurance buyers don’t take time to complete a BI worksheet—a valuable tool to determine proper exposure levels. The tool forces buyers and agents to address all aspects of a potential loss and its business impact.
• Employee dishonesty limits. Hotel owners think they’ll never use this, and then learn their controller has been siphoning off small amounts of money for years, and the total loss is substantial.
• Guest discrimination coverage. Hotels might buy employment practices coverage and not the guest coverage. Some specialty programs provide the coverage in the GL form.
• Property in your care, custody or control. This is a “must have” for all hotels. Agents can offer this in the GL form or buy it as a legal liability (innkeepers) coverage on the crime policy.
• Health care professionals as insureds. Resorts with spas have this exposure and need this coverage.
• Valet parking services. Most full service upscale and luxury hotels and resorts offer valet parking services and need to be sure they are covered properly.
• Ordinance and law. This is key property coverage with the ever-changing building codes. Buyers either buy too little or go without to help control cost. That’s not a good decision.
• Green building coverage. The three key coverages are:

â—Š Green certified coverage. For a loss to a green certified building, coverage available from AGPOM will apply to rebuilding and additional expenses driven by regaining green certification.

â—Š Green upgrade coverage. This coverage pays the extra expense when a non-certified building opts to go green after a loss. Added costs might result from use of Energy Star equipment; eco-friendly lighting, paint and carpet; or water-efficient plumbing fixtures.

â—Š Green commissioning expense. This coverage provides for a commissioning engineer to inspect a newly built or repaired system after a covered loss to confirm operation at peak performance and expected efficiency.

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