How Much Does Cafe Insurance Cost?
When it comes to running a café, there are several factors that can influence the amount your business insurance will set you back.
The first of these factors is the size of your business. This can be assessed in terms of financial or physical value. Some might consider this as obvious; the smaller your coffee lounge, as a rule of thumb, the lower your insurance premium will be. The reason for this is that, naturally, a small coffee stall will have less to lose than a multi-storey café. This is because customers will spend less time on the premises, leading to fewer valuables to damage and fewer employees to manage.
The second factor is that of location. If you open your coffee shop in an area of town with high crime or with a high chance of environmental damage, such as flooding, your insurance premium will be higher. That being said, your café’s location can also have a positive impact on the cost of your hospitality insurance. For example, if your business is in a shopping mall your premium will be lower, as malls have their own security and fire alarms.
Thirdly, the type of equipment used in the café can also have an impact on the price of your insurance. For instance, deep fat fryers and woks are common causes of personal injury and property damage. This will require a higher payout if your establishment needs one of these appliances.
The fourth factor depends on your café's level of insurance. If you want to go with a cheaper insurance plan then a basic public liability policy with added glass cover will meet the minimum insurance requirements for a lease. This level of cover typically costs less than a thousand dollars, unless there is a higher risk with regards to your own business. However, if you wish to insure your café more thoroughly there are several more policies available, such as contents, stock, general property, theft, machinery breakdown, and business interruption. This factor, clearly, is dependent on how much you can spend on your insurance or how much risk you’re willing to take with your insurance.
Finally, there are some ways in which you can reduce your insurance premium, the most common of which is fire protection. If your establishment has access to fire extinguishers or other forms of fire prevention then your insurance will be lower, particularly if you have sprinklers installed as these are favoured by insurers more than other protection measures. Another way in which you can reduce insurance prices is by investing in sufficient break-in deterrents, and by upholding proper health and safety standards to minimise risk in the work place.
If you’ve read this far you will know that there is not a one-size-fits-all when it comes to the cost of café insurance. The best option to determine your café’s insurance cost is to speak with one of our qualified brokers, whom have dealt with cafes and other hospitality establishments for many years. Call (03) 9791 6688.