Getting the right insurance to cover your hotel or resort business is critical. Read on to learn more about the different types of cover and to make sure that you make the right choice.
Limitations of a Basic Package
A hotel or holiday resort is a business, and, as such, it is governed by all the forces which usually affect a business, in particular, profit and loss. With this in mind, it might be tempting to plump for a basic package with relatively low cost premiums.
Unfortunately, while this can save you money in the short term, the long term ramifications are less optimistic. If you find yourself without the insurance you need, the cost to you and your business could be great.
Basic hotel and resort insurance packages will be spread across two tiers; liability insurance and property insurance.
Property insurance will deal with damage or loss related to the property of the hotel or resort and its guests. This includes damage to indoor and outdoor features of the resort, computers and electronic devices on site, data loss for accounts receivable, clean-up following extinguishing of fires, losses following power surges or failures, among other areas.
Liability insurance will, instead, deal with damages suffered by a staff member, guest or third party. This generally includes;
- Damages or bodily injury to a third party
- Liability relating to slanderous or libelous messaging, via advertising or other channels
- Loss or damage of guest property
- Hotel or resort professional liability
- Personal injury insurance
- Medical liability (cost of treatment)
- Liabilities on both written and oral contracts
While this might seem to be comprehensive, it may not provide everything that the particulars of your hotel or resort business require. It is certainly worth taking the time to examine the cover and protection you are entitled to and weighing that up against what you need. No one likes nasty surprises, after all.
Additional coverage can take many forms. What you need really depends on the type of hotel or resort business you operate. For example;
- If you serve alcoholic drinks, either in a bar, via room service or within a restaurant, you may need additional liquor liability attached to your insurance coverage.
- If you own or operate any sort of fleet of commercial vehicles – for example, taxi or airport shuttle services, or delivery fleet – this may require additional liability coverage.
- Unforeseen circumstances which prevent you from running your business and making money may not be covered in your standard insurance package.
- While losses related to acts of crime against property or person should be covered to an extent, you may want to consider additional criminal components for comprehensive coverage.
There are additional coverage options that are not listed above. Your package can cover any aspect of your business and its profits which are not covered in your basic hotel or resort policy.
Tips to Avoid Being Underinsured
Finding that your hotel or resort insurance policy does not quite cover what you need it to cover is not a good feeling, and can be potentially disastrous as far as your business is concerned. By following these tips, you can make sure you receive the full coverage you need.
Audit what you have – It is important to understand the coverage that you already have. Examine your policy carefully and make sure that what you are paying for is suitable for your needs. It is also important to check that you are not overpaying; for example, if you are paying for commercial vehicle insurance when you do not operate any vehicles relating to your business.
Be realistic about what you need – What could potentially cost you a lot of money? Doing a thorough risk assessment is the only way to answer this question. This will give you a framework which you can apply when weighing up a potential policy.
Speak to a broker or agent – Gaining professional assistance which you can trust is a failsafe way for you to acquire the coverage you need.
All information provided in this blog is for informational purposes only. The sources used are presumed accurate. CITA Insurance Services, Brown & Brown Program Insurance Services, Inc. and Brown & Brown, Inc. will not be liable for any errors, omissions, losses, injuries or damages arising from its display or use and will not assume responsibility for any misguided information. No guarantees are implied.