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Risk Management for Restaurants in a COVID-19 World

For restauranteurs, every meal is equally important. Each step in the process—from getting ingredients from suppliers and planning the menu to executing the final dish to serve to the customer—is just as important as the last. Unfortunately, every restauranteur also knows how frustrating it can be when something goes awry: the entire system can come to a grinding halt. Every step has risks and every risk has to be managed.


Restaurants, perhaps more than most other businesses, face a slew of risk exposures and, likewise, have a slew of insurance coverage options which include the following:

• Business Interruption

• Equipment Breakdown

• Property

• Workers’ Compensation

• Inland Marine

• Business Owner’s Policy

• Liquor Liability

• Spoilage


Thinking about all of these options can be overwhelming, but it is important to ensure you are getting the right coverage for the right risk exposures. Purchasing insurance for situations you will never encounter is not a good idea. If you don’t serve liquor and don’t have a liquor license, you won’t be needing liquor liability, for example. With that being said, understanding what exposures you do or do not face is not always as easy as it seems. That is especially true in the time during and following COVID-19, which has turned a lot of industries upside down with widespread changes.


In the world of COVID-19, it should be clearer than ever that the only way to “expect the unexpected” is to be proactive. That could mean having the right insurance in place or it could mean having robust management systems that can pivot in the event of a restaurant shutdown or other crisis. It isn’t easy, but it’s something that must be taken into account heading into the future. Hundreds of businesses, not just restaurants, have shut down permanently because they were unable (or unwilling) to adapt to changes in the business ecosystem. There’s no way to predict the future, but it should be clear by now that taking a proactive approach and having contingency plans in place is a vital aspect of business ownership.



Managing and owning a restaurant is not an easy task. It doesn’t have to be made harder by piling risk management tasks on top of an already packed schedule of day-to-day operations. Contact an insurance professional to help ensure your business is complying with local and state laws and also covering all of the risk exposures you may face. It’s always better to be safe than sorry.

Whether a restaurant is family owned or a national franchise, the risk exposures are the same especially with COVID-19. Is your restaurant prepared to handle whatever might come its way? It pays to be sure. Reach out to Nesbit Agencies at 952-941-9418 or info@nesbitagencies.com to get started managing your risk today.


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© 2021 by Ross Nesbit Agencies, Inc.