Hotels are exposed to multiple and varied risks because they have a lot of property, serve many guests and often employ large staffs. If you run a hotel, you’ll likely want a hospitality insurance policy that covers these four common risks.
Is Your Hotel Protected from These 4 Risks by Hospitality Insurance?
Cyber Threats and Data Breaches
Hotels electronically send, receive and store guest data, which exposes hotels to potential cyber threats and data breaches. Mishandling a customer’s credit card number can have serious consequences, and some nefarious attacks can be even more devastating. A ransomware attack made it impossible for one ski resort in Austria to open guests’ doors until the ransom was paid -- and the attack came when the hotel was at maximum capacity.
Hospitality insurance policies that include cyber liability coverage may help protect against both online attacks and data breaches. This coverage might help pay ransomware demands, compensate affected guests and cover legal fees associated with covered incidents, depending on the coverage’s terms and conditions.
Theft and Vandalism
Any business that has as much property as hotels do is at risk of having property stolen or vandalized. Burglars may break into rooms, guests may take items from rooms and vandals may deface areas.
These kinds of risks are usually covered through a policy’s commercial property coverage. A policy’s specific language will determine both what incidents are covered and what property is covered. Review any policy your hotel has or is considering to make sure the policy will cover your hotel’s building, secondary structures, equipment and fixtures.
Commercial property coverage is also typically the coverage that protects against storms, fires and similar perils.
Slips, Falls and Other Injuries
With lots of people walking (and running) around your hotel, there’s bound to be times when guests are injured on the property. Some guests may shrug off minor bumps, but others who are more assertive or suffer more significant injuries may blame your hotel.
If your hotel’s found responsible for a guest’s injury, the business could have to pay for medical costs, pain and suffering, lost wages and more. Even if your hotel is deemed to be free of responsibility, legal fees may still be incurred.
General liability coverage is a protection that normally helps protect businesses from claims that accompany covered third-party injuries. This is a coverage that many businesses have and one that your hotel almost certainly needs.
Intoxicated and Rowdy Guests
Guests who become too intoxicated are at greater risk of being injured, and they can cause many other issues as well. Drunk guests may get into fights with others, sexual assault others or get into an accident while driving to buy more booze.
While intoxicated guests can be held responsible for their actions, your hotel might also be held liable if it served or sold the guests any alcohol. Moreover, claims involving intoxicated individuals often are excluded from general liability coverage’s protections.
If your hotel offers alcohol, either for free or for sale, the hotel should probably have liquor liability coverage. This unique coverage is specifically designed to offer protection against certain incidents involving that involve intoxicated individuals. Coverage might cover injuries, fights, sexual assaults, DWI accidents and more.
Work with an Agent Who Knows Hospitality Insurance
While these risks are common, knowing how to protect a hotel from them isn’t general knowledge. Insuring hotels is a specialized niche within the insurance industry, and it’s one that requires years of experience helping clients who work in hospitality.
For help finding a hospitality insurance policy that has all the coverages your hotel needs, contact an independent insurance agent who’s assisted many other hotels. A knowledgeable agent will know what to look for in each of these four coverages, and they’ll know what other coverages might help protect your particular hotel from the risks it faces.