Every business owner in the hospitality industry knows that every day presents new and difficult risks to overcome. It is the nature of the business. Sometimes, things go wrong. A guest slips and falls or the valet driver damages a vehicle. There are many situations that you need to address. For hotel owners and those in the hospitality industry, excess liability insurance shouldn’t be considered optional. The question is less of “Do I need excess liability coverage?” and more, “How much coverage do I need?”.
A hotel may host a large number of occupants at any given time. It may also have large premises and product liability exposures that come with operating a hotel. As a result, it is very important that a hotel protects its business and assets with adequate liability limits. When your current business insurance liability coverage has been exhausted in a claim, the excess liability coverage, otherwise known as an umbrella policy, will step in to help cover the remaining costs. At a time when finances need to be cared for diligently, taking out extra protection for your hotel’s profit is incredibly wise.
Determining how much umbrella coverage to purchase can be difficult at first. Umbrellas are sold in ‘layers’ of $1,000,000 each. How many layers you should buy can be first determined by the value of the business’s assets. Generally, it is advisable to purchase liability limits that at least match your property values.
Secondly, the risks and exposures present at each specific hotel or hospitality establishment should be considered in order to determine if additional umbrella layers should be obtained. If a hotel offers food service via a restaurant, serves alcohol, has a swimming pool, or offers guests rides to and from a nearby airport, the establishment will have higher and more severe liability exposures. To protect the hotel, it will need higher umbrella limits.
Excess liability insurance, or an umbrella policy, can increase your coverage for:
- Lawsuits and legal expenses related to your hospitality business
- Property damage and bodily injury cases such as slips and falls
- Additional protection for your commercial auto insurance policy
- And other excess liability on top of your primary commercial insurance policy
Work with the right insurance agent to secure reliable hospitality insurance that addresses hotel concerns and risks. Each business will need a unique layer of umbrella coverage. While a restaurant owner needs to be covered against customers possibly getting food poisoning, a gym needs to be careful of slips and falls, and an airport hotel needs protection against their shuttle service.
ABOUT RMS Insurance Brokerage, LLC
At RMS Insurance Brokerage, our expertly crafted policies are written specifically for the hospitality industry. We offer custom-tailored solutions to meet any venue’s specific needs. For more information, contact our knowledgeable experts today at (516) 742-8585.