Small business insurance for cafes

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It takes planning, passion, and dedication to open your own cafe, and build a steady stream of regular customers. With all the investment you’re putting in, it’s important to protect your hard work and starting capital with the proper insurance. Cafes face risks and hazards that are unique to the hospitality industry. While stock and equipment are important, for coffee shops, cover against customer and employee risk is just as vital. In this article, we’ll outline the main kinds of insurance you should consider, to make sure your cafe is properly protected.

Product and Public Liability Insurance

Have you ever seen waitstaff spill hot coffee on a customer? What about a supplier tripping on a plastic mat when delivering goods? Or a customer complaining of an upset stomach after a meal? These are not uncommon circumstances. But each of these could lead to a claim against your business. Such claims can cost thousands of dollars, and are among the most expensive risks faced by cafe owners. Product and public liability insurance can insure all amounts which you, or an insured person, become legally liable to pay as compensation for Personal Injury or Property Damage resulting from an occurrence connected to your business.

Machinery breakdown

As a cafe, you are reliant on expensive equipment, such as coffee machines, grinders, fridges, and exhaust fans. Most of this equipment can be easily repaired, but the cost of fixing it can be expensive. Machinery breakdown insurance covers costs of repair or replacement of broken down machinery. It also includes a number of other benefits that help your cafe continue to operate, such as the cost of hiring temporary machinery, removal of debris, and temporary cover for any additional machinery you bring or install for a period of 90 days.

Deterioration of stock

If your fridges stop working, then you face another expensive problem. You now have no way to refrigerate your food. Even if you do find a backup option your food may already have been at the wrong temperature too long to serve. Deterioration of stock insurance covers your cafe for exactly such circumstances. This is an optional extra that can be added to your machinery breakdown insurance. That way, may be covered if your fridges or freezers stop working.

Management liability

Unfortunately, cafes are one of the easiest environments for employee theft. Large amounts of cash is handled on a daily basis, and long opening hours mean that full staff supervision is not always possible. You can protect your business against the risk of employee theft with Crime cover under Management Liability insurance. This covers you for any loss of money that belongs to your business, which has been unlawfully taken by an employee. Management liability usually also includes employment practices liability, which can cover you for claims for specific employment practices breaches, such as discrimination, wrongful dismissal or sexual harassment.

As you can see, it takes a number of different types of insurance to make sure your cafe is properly protected. Fortunately, you can often find these types of cover available to be selected in a Small Business Advantage Pack Insurance, saving you time and money when arranging your insurance. That way, you can worry less about risks to your cafe and focus on building up your business.

Brought to you by Allianz Insurance

Allianz Small Business Insurance is issued by Allianz Australia Insurance Limited ABN 15 000 122 850 AFSL 234708. We do not provide advice based on any consideration of your objectives, financial situation or needs. Terms, conditions, limits and exclusions apply. Before making a decision please consider the product disclosure statement available here.

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