Hotel insurance


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Getting the right hotel insurance is essential to deal with the financial impact of potential risks. Get expert help to make sure you’re protected and save money by comparing available policies and prices.

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Frequently asked questions

Why do I need specialist hotel insurance?

Hotels have specific insurance needs. There are lots of potential risks that hoteliers will want to protect themselves against, from guests having an accident on the premises to a bathroom being flooded or a fire in the kitchen, not to mention a member of staff injuring themselves while at work.

How can I find the right cover for my hotel?

No two hotels are the same and what insurance you require will depend on a number of factors including:

  • how many rooms you have  
  • the type of building
  • your turnover
  • how many staff you employ - both regularly and for events  
  • if you hold events and functions – for example, weddings, business conferences and dinners

You’ll also need to think about the different kinds of cover you might need as part of your hotel insurance. This breaks down into three main areas:

  • The people – your staff and guests. Public and employers' liability insurance can help protect you if someone gets injured or their property is damaged.
  • The hotel building and contents – if you own the freehold of the hotel or are liable for rebuilding costs buildings cover will protect what is arguably your most expensive asset – the hotel itself – if you need to make repairs or even rebuild. Contents cover will help protect the stock and equipment you need to keep running.
  • Your income – business interruption insurance can help keep you afloat if you have to close for weeks or even months.

The other types of insurance you take out will depend on your specific needs and what you offer in the way of services. Our experts can help you calculate what risks your hotel might face and talk you through the best quotes and policies for you.

Why might I need public liability insurance cover?

Public liability insurance means you can claim to pay compensation to anyone whose property is lost or damaged, or who suffers an injury during a stay at your hotel. An example might be a guest slipping on a wet floor and hurting themselves. As a hotel you are ultimately liable because it’s your responsibility to oversee that the property is kept safe and risk-free. 

Public liability limits are usually offered at £1 million as standard. If you have an on-street seating area or hold functions open to non-guests, for example weddings and business meetings and conferences, some local councils might require you to have a higher level of public liability insurance, maybe £5 million or £10 million. 

Why might I need employers' liability insurance cover?

If you have one or more people working for you, you'll need employers' liability insurance. 

This is a legal requirement and is usually from £5 million. Employers’ liability cover means that you have access to funds if you need to compensate a member of your staff who has suffered an illness or injury as a result of working for you.

If you don’t have this kind of insurance in place you could be fined £2,500 every day if you’re not properly insured.  

How can I protect my hotel building?

Any hotel’s most expensive and valuable asset is its building. If you own the freehold of the hotel or are liable for rebuilding costs, you should insure it for the cost of rebuilding the property should the worst happen. Buildings insurance also covers the cost of repairing damage to your hotel – say if there was a fire in one of the rooms or a storm damaged the roof.

When you calculate the rebuilding cost you should factor in any other buildings, boundary walls, swimming pools, fitted kitchens and bathrooms as well as the main building itself.  Our advisers can help you work out the rebuilding cost.  

Even if you don’t own the building you can still take out buildings insurance for a rented property.

What contents insurance will I need for my hotel?

In addition to buildings cover you should also take out contents insurance to cover the furniture, décor and stock that are essential to keeping your hotel running against theft or damage.  

Insurance providers often describe 'contents' as all the things that would fall out if you turned your house or hotel upside down. So that means furniture, lamps and decorations are contents, but walls, ceilings, bathroom fittings and kitchen cabinets come under buildings insurance. Carpets are the exception to the rule and usually come under contents insurance.

Make sure you add up the value of all the contents from the teaspoons to the TVs, the kitchen equipment to the linens.

You’ll also need to consider guest contents cover. Covering guests’ contents as part of your hotel policy means all your customers’ belongings are protected if they are stolen or damaged. It’s a legal requirement in line with the Hotel Proprietors Act 1956 so you can be liable to make good the loss or damage, even if it wasn't due to your fault or any of your staff. The amount of cover you need depends on how many guests might be staying at your hotel at any given time.

Why might I need business interruption cover?

This covers the loss of income you could suffer after a disaster. For example, if your hotel is flooded, your buildings and contents insurance would cover any damage to the fabric of the building and carpets and furniture, but business interruption insurance could cover you for loss of income while you are unable to have guests staying.

Possible policy add-ons

There are a few optional extras you can include on your policy too.  

Personal contents cover  

If you or your staff live in the hotel, you’ll need personal contents cover to protect your personal possessions. This works in the same way as home contents insurance - you can claim if your own or staff’s personal property is damaged or stolen from the hotel.

Legal cover

This option means you can claim for the cost of legal action against another party. Sometimes this can be included in your business policy, and sometimes not, so check the details if this is something you’re interested in. Some insurance providers will also offer telephone helplines to give you expert advice on anything from legal matters to health and safety issues.

Remember to check the policy details

As we’ve said before, no two hotels are the same, so before you decide on a policy you should check all the details, to make sure it suits your exact needs. It’s particularly worth looking out for: 

  • Glass replacement – you might have big picture windows to capture views or glass doors in your building. Will your insurance cover the cost of replacing frames if needed, or emergency call outs in case of damage?
  • Seasonal increases – if you do a lot of business over the summer or in the run up to Christmas, does your policy take into account that you might have extra stock on the premises at these times?
  • Gyms, swimming pools, saunas and spa treatments are now common in hotels – does your cover include any potential associated risks?
  • Accidental damage – if a guest's suitcase catches on a table leg and sends a valuable vase or ornament flying would you be protected against loss?
  • Theft and security – given that hotels are normally open 24/7 you need to understand what the exclusions are around theft, forced entry, employee theft and so on.
  • Alternative accommodation – covers the cost of finding your guests somewhere else to stay if you have to close at short notice.
  • Cyber cover – covers the costs of computer hacking or viruses.
  • Contractors’ risks – for contractors working on the hotel.
  • Terrorism – covers the costs of dealing with the impact of a terrorist related event
  • Goods in transit – for example, food deliveries

What's the difference between a hotel and a guest house?

You might be confused about whether you need hotel insurance or guest house cover. The AA in its ratings guide for inspecting and rating accommodation distinguishes between them as follows:

  • Hotel: Formal accommodation offering full hotel service
  • Guest house: Accommodation for more than six paying guests, with the owner and staff providing more services, e.g. dinner

The main difference between the two is the 24/7 service on offer at hotels, with hotels also generally offering more rooms.

Just tell our expert adviser about the kind of business you run and they will be able to help ensure you get the right insurance.

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