Insurance Policies to Consider For Hotel and Motel Business

What Is Hotel Business Insurance and How Does It Work?

Hotel-motel insurance is a particularly specific sort of business insurance policy (BOP) that has been developed to fit your company's specific coverage needs.

There are a variety of coverage alternatives available, giving you the flexibility to create a portfolio of coverages that is tailored to your individual needs.

What are the dangers that hotels face?

As a hotel owner, you must be prepared for all kinds of risks and unexpected scenarios, as the hospitality business is subjected to high-profile lawsuits on a regular basis. And having a good set of hotel insurance plans is the only way to adequately secure your business. 

General Liability Insurance

Every business, despite the type of industry it is in, faces dangers that should be covered by the right type of insurance. The most comprehensive and common type of insurance policy that hotel and motel owners purchase is general liability insurance. General liability insurance provides coverage for the following: 

• Bodily injury
• Personal and advertising injury
• Medical payments
• Bodily Injury
• Legal defense and judgment
• Property damage

While general liability insurance is not needed by law, it is exceedingly dangerous to operate without it. If your company is sued, you might face hundreds of thousands of dollars in legal fees (or more). As a result, the only way to avoid this type of catastrophe destroying your organization is to have an adequate general liability insurance plan in place to help recompense for these losses.

Business Owner's Policy

A business owner policy (BOP) is a single insurance plan that covers all key property and liability risks. This type of policy combines all of a business owner's essential coverages into one package. It is, however, frequently sold at a lower price than the total cost of the individual coverages. 

A Business Owner's Policy (BOP) is a single commercial insurance policy that covers business property and liability insurance. BOP insurance protects your company from claims originating from calamities such as fire, theft, or other covered events. Business owners' insurance also aids in the coverage of claims that may emerge as a result of your company's operations. These include personal injury and property damage claims. Personal injury and advertising injury claims are also included. 

Property Insurance

Commercial property insurance protects the assets of a company from risks such as fire and wind. The majority of insurance also covers equipment and supplies held on the insured property. Hotel structures are frequently worth a lot of money. Make sure your hotel's insurance policy covers the cost of rebuilding the property if it is damaged by a covered risk. 

Workers' Compensation Insurance 

Because hotels employ people, they normally require workers' compensation insurance. Most states require firms that hire employees to carry this coverage, which protects against work-related illnesses and injuries.

Insurance against cyber-attacks

Both hostile internet attacks and non-criminal data breaches can be protected with cyber attack insurance. General liability coverage frequently excludes these types of accidents. Ransomware has acquired the data of several hotels, and in some cases, the attacks have left electronic room locks unusable. Cyber attack insurance can be purchased separately or as part of a larger package policy to protect hotel and motel businesses from cyber-attacks and hacking.

Additional Insurance Coverages for Hotel and Motel Businesses 

In addition to the insurance policies listed above, your hotel may require additional coverage depending on particular aspects of its business. Some of these may not apply to your business, so make sure to ask your agent which insurance is appropriate for you. 

Insurance for Commercial Vehicles

If your hotel operates a shuttle service, the van must be covered by commercial motor or auto insurance. Most states require businesses to obtain minimum levels of coverage for their automobiles, and many firms purchase more coverage than is required. Commercial auto insurance is available alone or as part of package coverage. 

Business Interruption Insurance 

Business Interruption Insurance is a type of insurance that protects a company from loss of income in case the business operations suddenly come to a stop. Even in the event of a calamity, the costs of running a hotel must be paid on a monthly basis. If your hotel is forced to close due to a covered disaster, business interruption insurance may be able to help cover recurrent expenses while the hotel is closed. Business interruption insurance is usually included in Business Owners Policy.

Additional Security Measures for Your Company

Investing in company insurance is simple (and necessary), but it should not be your first line of defense. Yes, insurance will cover your company's financial damages in the event of an accident, but it's much preferable to avoid them altogether. With this in mind, here are some steps you can take to improve the security of your company:

• Use contracts and other business documents that are legally sound
• To protect your personal assets, form a limited liability company (LLC) or a corporation
• Keep your business licenses up to date
• Streamline the internal procedures of your company. This will eliminate unnecessary variables from frequent processes and establish a secure, consistent corporate environment

Is insurance required before I start a business? 

Before you have your first customer transaction, you should get insurance for your firm. Although the expense of insurance for a new business may seem prohibitive, it's better to be proactive when it comes to safeguarding your assets. After all, insurance cannot be purchased to compensate for a loss that has already occurred.