Arranging Insurance

Insurance Cover

For many people the subject of insurance is not a very exciting one. Insurance cover is sometimes left until the last minute and not given a great deal of attention. This can be a costly mistake. Obtaining the correct cover will not only help protect you and your business but will also ensure that you do not break the law. Arranging insurance cover needs a little thought, and you are advised to talk to a specialist broker to discuss your requirements and make sure that you and your business are correctly covered.

Insurance Brokers

The insurance industry is regulated by the Financial Services Authority (FSA), which is an independent organisation responsible for regulating all financial services in the UK. Insurance brokers should be registered with the FSA. Always check a firm is authorised by them, or is the agent of an authorised firm before you do business with them. If they are not authorised and things go wrong you will not have access to complaints procedures and compensation schemes. You can check that a broker is registered via the FSA website: www.fsa.gov.uk /register or you can telephone them on 020 7676 1000.

Pub insurance is a specialist form of insurance and you should check that your broker has experience of arranging this.

What Insurance Cover Do You Need?

The type of cover you need will depend on whether you have acquired your pub on a tenancy, lease, or have bought the freehold of your pub. Insurance cover that you may require can be broadly divided into 4 main types of policies:

1 General Pub Insurance Policies

These can cover:

public liability;
employers’ liability;
fixtures and fittings and equipment;
money;
loss of licence;
assault;
business interruption.

Pub policies are specialist forms of insurance combining a range of insurance cover. This type of insurance is needed for tenancy, lease and freehold pubs.

2 Building Insurance Cover

This covers:

The cost of reinstating the building in case of damage or destruction.

This type of cover is usually only required for leased or freehold pubs, as a tenant is not normally responsible for the ‘bricks and mortar’ of the building. For leases, the brewery or pub company may hold the building insurance policy and you may not need to arrange for this yourself. They may however, pass the cost of the building insurance premium on to you. Claims may also be handled through them. Various tenancy or lease agreements place different obligations on licensees. You should check with the brewery or pub company whether you are responsible for the building insurance and, if so, whether you are required to arrange this cover yourself or be re-charged for the premium.

Where you have bought the freehold of your pub, you will need to arrange building insurance cover yourself. (See below for more details.)

3 Home Contents Insurance

This is to cover:

your personal possessions.

This is often overlooked when taking on a pub. Your pub policy may well not include cover for your personal items. Separate cover is required to ensure that these are correctly covered.

4 Life Insurance

This is to protect:

dependents and the business.

Lenders may insist that you take out life insurance cover to ensure that any outstanding debts can be paid in the event of your death.

Other insurance cover that you may wish to consider includes personal accident and sickness cover and private medical insurance. Please note that the above is not a definitive list and you should discuss your particular requirements with an insurance broker.

Some Important Considerations

Public Liability

Public liability insurance covers your legal liability to pay damages to members of the public for injury, death or damage to their property. It also covers legal fees, costs and other expenses. Awards for injury can exceed £ 1 million. Adequate public liability cover is an essential to safeguard you against such claims.