Insurance for Hotels and Motels

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Why Hotels and Motels Need Insurance

These establishments provide temporary lodging as well as various entertainment and leisure services. Businesses in this industry include bed-and-breakfasts, hotels, motels, and inns. These establishments provide food and beverages as amenities, as well as different room types with different rates.

Hospitality establishments like hotels and motels provide guests a sense of comfort and safety away from their home. While you offer a highly needed service to travelers, your hospitality puts you at great risk every day. If you don’t properly protect yourself with insurance for your hotel or motel, you risk the biggest loss of all, financial hardship and business failure.

Top 5 Risks Hotels and Motels May Face

  1. Fire destroys your building. If a guest starts an accidental fire in their room or an electrical explosion causes a fire, you can be forced you to close your doors until you rebuild or fix the damage.
  2. A child drowns in the swimming pool. The majority of hotels and motels don’t have lifeguards at their swimming pools. What happens in the swimming area is often out of your control. If a child slips into the deep end with nobody noticing, and drowns, the family can file a lawsuit holding you responsible.
  3. Restaurant food causes sickness. Today, many hotels have restaurants. If you serve spoiled or contaminated food that causes food poisoning, you are responsible for any medical expenses associated with it.
  4. Stolen customer records. To properly do business and stay organized, you have a vast database full of sensitive customer information. This data includes names, addresses, e-mails, and credit card information. Hackers flock to small businesses with little or no cyber security in place to steal this valuable information. When that happens, there are a lot of notification, investigation, and settlement expenses involved that you have to pay.
  5. Theft of guest’s belongings. You can be held liable for missing items from cars, rooms, and common areas even if you have signs posted saying otherwise.

What Types of Coverage do Hotels and Motels Need?

All hotels and motels need commercial property and general liability insurance. If you have a shuttle, you also need business auto insurance, and if you have employees, worker’s compensation and employee dishonesty are a must.

  • General Liability: Pays expenses when you are held liable for a third party’s injuries or property damage including falling on wet floors or food poisoning.
  • Commercial Property: Provides coverage when your building or property is damaged in a covered peril like a fire. It pays the costs to fix the damage, and the best policies include loss of business income so you can still pay fixed costs while you are closed.
  • Business Auto: Shuttle drivers spend a lot of time transporting guests to their destinations. If an accident occurs, you need business auto insurance to pay costs to fix the shuttle as well as third-party medical expenses and property damage if your driver is at fault.
  • Cyber Liability: This policy pays all necessary costs to remain compliant with state and federal laws when a cyber breach occurs. It also pays the cost to replace stolen credit card information, investigate the crime, and settle and lawsuits arising from it.
  • Innkeepers: This is a coverage exclusive to hotels and motels that pays to replace guest’s property that was stolen at your location.

How Much Does Hotel and Motel Insurance Cost?

All hotels and motels are rated differently by insurance carriers. The majority review your experience, claims history, and security policies to calculate the cost of hotel and motel insurance. You can request a quote for your hotel or motel insurance now using the form below.

What type of insurance does this industry need?

Policy What is it? Why get it Popularity in your industry Want free quotes?
General Liability
This policy protects your business in case of third party claims, such as bodily injury or property damage. For example, the common "slip-and-fall" claim would be covered by your General Liability policy. General Liability insurance is often considered to be the core coverage, particularly for businesses that regularly physically interact with customers or sell physical goods. In addition, many businesses have a contract, like a loan or a lease, requiring that they have this coverage.

What is it: This policy protects your business in case of third party claims, such as bodily injury or property damage. For example, the common "slip-and-fall" claim would be covered by your General Liability policy.

Why get it: General Liability insurance is often considered to be the core coverage, particularly for businesses that regularly physically interact with customers or sell physical goods. In addition, many businesses have a contract, like a loan or a lease, requiring that they have this coverage.

Commercial Property
This policy protects the business's physical assets and is appropriate whether you own or lease your space. Keep in mind that this policy will only offer protection in the case of covered events. If you need protection for certain scenarios, such as floods or earthquakes, you may need additional coverage. If you have a mortgage or a lease, you may be required to have property insurance. Even if you are not, this is the best way to protect the building you are in and the business property you have in case of a natural disaster or some other accident.

What is it: This policy protects the business's physical assets and is appropriate whether you own or lease your space. Keep in mind that this policy will only offer protection in the case of covered events. If you need protection for certain scenarios, such as floods or earthquakes, you may need additional coverage.

Why get it: If you have a mortgage or a lease, you may be required to have property insurance. Even if you are not, this is the best way to protect the building you are in and the business property you have in case of a natural disaster or some other accident.

Umbrella Insurance
Umbrella insurance offers excess liability protection in the case that your General Liability, Commercial Auto Liability, and/or Employer's Liability coverage is insufficient. It essentially acts as a "back-up" plan, providing additional financial protection in the case that your business faces a particularly large claim that exceeds a single policy's limits. This policy can be particularly valuable for a business that faces a variety of risks and has multiple liability policies.

What is it: Umbrella insurance offers excess liability protection in the case that your General Liability, Commercial Auto Liability, and/or Employer's Liability coverage is insufficient. It essentially acts as a "back-up" plan, providing additional financial protection in the case that your business faces a particularly large claim that exceeds a single policy's limits.

Why get it: This policy can be particularly valuable for a business that faces a variety of risks and has multiple liability policies.

Workers Compensation
Workers Compensation covers an employee's lost wages and the cost of resulting medical treatment if they suffer a work-related injury or disease. It also covers services needed to help the employee recover and return to work. Workers Compensation coverage is mandatory in most states. The number of employees after which it's required differs by state, but you will generally need coverage once you have employees.

What is it: Workers Compensation covers an employee's lost wages and the cost of resulting medical treatment if they suffer a work-related injury or disease. It also covers services needed to help the employee recover and return to work.

Why get it: Workers Compensation coverage is mandatory in most states. The number of employees after which it's required differs by state, but you will generally need coverage once you have employees.

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