Month: June 2016

What is the best coverage for a Bar or Tavern Owner?

General Liability, Commercial Crime or Assault and Battery Insurance for Bars and Taverns

Get the answers to your bar liability needs at generalliabilityclasscodes.com

The answer to the question above truly is all three types are best because they each provide different layers of protection for the Bar or Tavern Owner. Bar and Taverns are classified under the general liability class codes are used to underwrite a general liability policy for you. The class codes for bars and taverns are:

SIC Business Insurance Codes:

  • 5183 –Bars (Beer and Alcohol)

NAICS Liability Classifications:

  • 7244 10 Drinking Establishment with Alcohol

Business ISO General Liability:

  • Code 16920 – Restaurant-alcohol sales> 75% – Table service, dance floor
  • Code 16921 – Restaurant-alcohol sales>75%- No Table Service, but dance floor
  • Code 16931- Restaurant –Alcohol sales> 75% No Table service, no dance floor
  • Code 16940 – Restaurant –Alcohol sales> 75% Bar Service only, with dance floor
  • Code 16941 Restaurant – Alcohol sales> 75% – Bar Service only, no dance floor

Your agent will also want to know what type of services you provide for example; amusements such as pool tables and games, live musical performances or rides such as the mechanical bull ride made famous by the movie, “Urban Cowboy”, located at Gilley’s Bar & Grill in Texas. The purpose behind the codes determination process is to ensure that all the services your business provides are included in the scope of your coverage and you are not left with gaps in your insurance. Once your codes are properly defined your agent or broker will use them to determine what coverage is best for your business and what carrier writes that type of policy.

General Liability insurance is commonly required for all businesses by law, depending on the state you’re located in.  Think of general liability as the foundation or platform you are building upon to protect your business.    At this time, most insurance agents and carriers recommend combining your general liability policy with a business owner’s package designed for your specific industry with supplements, additional policies, riders and /or floaters much like building a custom home. Imagine that these insurance options are all layers of insulation you are adding to you building to protect and enhance it. It is your choice whether you want basic minimal protection or the best insulation available. This is a similar process to choosing loose fill insulation versus rigid foam board insulation.

Sometimes the above concept is not readily apparent to the company seeking insurance. It may be confusing because insurers speak their own language, using insurance terms and jargon, which some business owners may not be familiar with.  The main point here is general liability does not cover every situation the bar owner may be faced with. In particular, it does not cover most crimes and usually excludes assault and battery specifically. So you need another layer of protection

Many times new coverage options come about as a result of litigation and an unmet need for certain coverage in a specific industry.  This is in essence the law of supply and demand at work, and is the exact reason that separate optional policies or riders were developed to provide Assault and Battery Insurance. While on appeal in a suit filed against the bar owner of an establishment called Gigi’s  for assault and battery brought by the injured patron; Gigi’s insurer, Lloyd’s of London, requested a declaratory judgment upholding the exclusionary clause in their insurance policy and to determine that Lloyd’s had no obligation to defend or indemnify the bar owner.  The Court found in favor of Lloyd’s of London and upheld the exclusionary clause.  Lloyds of London is one of the premier insurance carriers in the world and this case made history in the insurance realm.  Unfortunately, this left bar owners in general with an undoubted gap in coverage and a significant need for insurance to address this gap. Bars and Taverns are inherently at risk for this type of occurrence on their premises, so assault and battery insurance is essential as it covers litigation associated expenses and damages to the injured victim and other patrons harmed in the incident.  Assault and battery is an intentional tort not a negligent act.   General liability is designed to cover negligence and accidents so the two actually work together to give you more protection.

This would lead to the next question: Then why do you need commercial crime insurance if you have assault and battery coverage? Again the answer is they each cover different types of harm. Commercial Crime does not cover assault and battery, but it generally covers the following types of matters: robbery, burglary, employee theft and dishonesty, forgery extortion, and computer fraud.  There are many complexities an agent or broker needs to consider before advising a tavern owner which form of commercial crime coverage is most advisable. Some insurance agencies use the standard ISO Commercial Crime Coverage forms or other forms to determine which insuring agreement you need for your protection.

Each of the above types of insurance can be purchased as a separate policy or rider, or in a BOP specifically designed for you.

Why Inland Marine Insurance can be your best investment in your business!

Attention: Landscapers and Lawnmowers. You need Inland Marine Insurance Coverage.

Get the answers to your inland marine insurance questions for your lawncare or landscaping business at generalliabilityclasscodes.com

Inland Marine Insurance really does not sound like a type of insurance a landscaper or lawnmower would be expected to need; but you absolutely do in order to avoid gaps in your coverage.  While the insurance class codes for landscapers and lawnmowers are not identical, common issues face both industries which can be addressed with this type of Insurance. Inland Marine insurance came into being as Ocean Marine Insurance in the very early days of transport across the ocean.  This coverage expanded to other water ways such as lakes, rivers, loches canals and channels known as inland waterways used to ship goods and cargo in all kinds of trade.  But the term has evolved with the times and can now be used to provide coverage for almost anything that is transported whether it’s over the ocean, inland water ways or over land; which brings us to the two most important reasons for having this type of insurance.

First, clients do not come to your shop to have you landscape their residential or commercial property, or trim their trees.  You need to travel to where the work is being performed and bring with you all the equipment and tools you need to do the job and those items must be transported.

Commercial Auto insurance does not cover transportation of tools and mobile equipment while Inland Marine Insurance does.  In fact, your commercial auto insurance policy may not cover all the specific type of “vehicles” you are using in your company at all if they are not defined as an automobile while the Inland Waterway Policy can insure moveable equipment and or unusual items used in any industry. So items applicable to landscaping and lawn mowing could include:

  • Heavy duty pickups, moving or cargo vans, or trailer used to transport tools and equipment.
  • Heavy equipment, e.g. Backhoes, bobcats, cement mixers, graders, and fork lifts used to perform the job.
  • Small or miscellaneous equipment and tools

Second, Inland Marine protects your equipment, tools any unusual item and can be designed to fit any and all of your needs if it is properly underwritten to be specific to your industry under the class codes. For instance snow removal can be added if the class code is added as secondary industry and you have a floater specifically for the snow removal equipment.   A variety of floaters are available and you can add any type of floater that your insurance carrier provides to your policy that is appropriate for your business. Inland Marine can be included in a business owner’s package or be a stand-alone policy in addition to your general liability and other traditional types of business insurance.

 

Inland Marine is unique to insurance, in that it can be written as “peril coverage “where only specifically listed items which are attached to the policy are covered; or “all risk”  Obviously the premium and deductibles would vary depending on which type you choose and  how much coverage you want.   The drawback to peril coverage is you must keep your list updated every time you have to replace or purchase a new piece of equipment or a tool, and advise your agent immediately of the change. In other words any item not listed is not covered.  The risk of failing to notify your agent timely can be partially addressed with a floater for new items purchased which extends your time to notify your agent but gives you less coverage for that item than if you had notified your agent sooner.

.Landscapers and Lawnmowers will primarily need Mobile Articles & Machinery and Equipment Coverage as a floater which is the type that will pay for damage incurred to the property or theft of the item during transit of the object. Regardless of whether you want a combination BOP or a stand-alone policy you would want to analyze whether you need additional optional “floaters” in your Inland Marine policy.   For instance:

  • Rented Leased or borrowed items floater if you rent machinery or equipment to use for specific jobs.
  • Computer /printer/hardware/software and business data floater if you take your computer with you to jobs to prepare bids, designs invoices etc.
  • Loss of revenue incurred due to loss of business data.
  • Installation floater if you leave machinery, building materials or other items at the job site for the duration of the project.
  • Bailee’s/customer’s goods floater in the instance where you might have possession of, or are transporting the owner’s property. This could occur in an instance such as the owner has purchased a large feature item, say a fountain, and the landscaper needs you to transport and install the fountain.
  • Employees tools

 

Another very crucial floater is Builders Risk a/k/a Course of Construction. This item may not be necessary if you are working with a General Contractor and you are a named insured on their policy.  Conversely, it could be highly beneficial if you are not working with a GC. You should thoroughly discuss each aspect of your work with your agent to determine when this floater is necessary, and periodically review whether you need this coverage as your business grows.

So, with a unique combination of floaters designed for you, Inland Marine insurance can be your key to protecting your business equipment, while being transported to and from the job site, throughout the duration of the job and back home to your headquarters  again,  giving you peace of mind and freeing you to focus on other aspects of your business.