Hospitality Venue Insurance Guide, Australia

Typical sum insured

$10m minimum residential cafe / $20m commercial venue

Public Liability protects the business when a customer, supplier, or member of the public is injured or has property damaged at the venue. The classic claim is a slip-and-fall on a wet floor, but PL also covers chair collapse, hot drink scalding, food handling injuries to customers, and damage to a customer's laptop or coat. Hospitality is a high-frequency PL category, premiums reflect that. Most commercial leases require a minimum $20m PL sum insured, often with the landlord as a 'noted interested party'.

What it commonly covers

• Slip-and-fall (the dominant claim type, ~40% of hospitality PL claims)
• Property damage to customer belongings
• Third-party injury at the venue or in the immediate trading area
• Often bundled with Product / Food Liability in a single 'Combined Liability' policy

Typical sum insured

$10m to $20m, usually bundled with PL

Food Liability, also called Products Liability, covers claims arising from the food and drink you sell. The biggest exposures are foodborne illness (salmonella, listeria, campylobacter), allergen reactions (anaphylaxis after undeclared peanuts is the worst-case scenario), and physical contamination (glass shard, metal fragment). A single foodborne illness outbreak can generate dozens of claims simultaneously, class-action-style exposure that PL alone may not cover.

What it commonly covers

• Foodborne illness claims, gastro outbreaks at functions are a recurring driver
• Allergen non-disclosure / mislabelling claims (post-Standard 1.2.3)
• Physical contamination (foreign objects in food)
• Recall costs and product withdrawal expenses (some policies)

Typical sum insured

$10m to $20m, mandatory for licensed venues

Standard PL policies exclude claims arising from intoxication. Liquor Liability fills that gap. It covers third-party claims arising from over-service (e.g., a patron causing injury after leaving the venue), serving minors, and intoxication-related slip-and-fall. Required by all state liquor licensing authorities for restaurant, on-premises, and producer licences. Many insurers will not write Liquor Liability without sighting current RSA certificates for every staff member who serves alcohol.

What it commonly covers

• Claims arising from over-service of alcohol
• Service to minors (extremely high penalty exposure)
• Intoxication-related injuries on or near the premises
• Often a sub-section of a hospitality 'Combined Liability' policy rather than standalone

Typical sum insured

Mandatory, state-based scheme, typically 3% to 6% of payroll

Workers Comp is a state-administered compulsory scheme, icare NSW, WorkSafe VIC, WorkCover QLD, ReturnToWorkSA, WorkCover WA, WorkSafe Tasmania, WorkSafe ACT, NT WorkSafe. Premiums are based on the industry classification (Class 8211, Cafes and Restaurants, sits around 3% to 4% of payroll; Class 8312, Pubs, Taverns, Bars, around 5% to 6%) and the venue's claims history. Mandatory the moment you hire any employee, casual or full-time. Burns, cuts, slips, and back strains are the most common kitchen claims.

What it commonly covers

• State-administered, separate scheme in each jurisdiction
• Premium = wages × industry rate × claims-experience modifier
• Burns from oil, steam, and ovens are the highest-cost claim category
• Return-to-work coordination is a statutory obligation for the employer

Typical sum insured

Replacement value, typically $200k to $2m+

Covers the physical premises and the contents inside it. If you own the building, you insure the building. If you lease (most cafes and restaurants), the landlord usually insures the structure and you insure the fit-out and contents, but the lease clause varies. Read it carefully. Contents covers kitchen equipment, furniture, POS hardware, stock, and signage. Replacement value (new-for-old) is the modern standard, avoid indemnity value (depreciated) which leaves big gaps after fire or theft.

What it commonly covers

• Fire is the dominant claim driver, typically a fryer or chargrill flashpoint
• Theft / break-in (especially in CBD venues)
• Storm and water damage (vital if you're in a flood-prone area)
• Stock spoilage from refrigeration breakdown is usually excluded (see Equipment Breakdown)

Typical sum insured

Mandatory for storefronts, sum insured matched to glazing value

Glass is often a separate policy or a stand-alone section within Building & Contents. Modern cafe storefronts feature large frameless glass shopfronts ($3,000 to $15,000+ per pane) and many include glass doors, display fridges, mirrors, and pendant fittings. Glass policies typically pay for replacement plus any unavoidable boarding-up while the replacement is sourced. Accidental breakage is the standard claim, vandalism and burglary are usually covered under different sections.

What it commonly covers

• Storefront window replacement is the dominant claim
• Doesn't usually cover frames, only the glass itself
• Some policies exclude internal glass (display cabinets, mirrors), check the schedule
• Often a low-deductible section ($100 to $200 excess), so even small breakages are claimable

Typical sum insured

12 to 18 months of gross profit, typically $300k to $2m sum insured

BI replaces lost revenue when an insured event (fire, flood, equipment breakdown that causes a closure) forces the venue to stop trading. After the 2020 to 2022 period, BI policies in Australia have become more carefully worded, many explicitly exclude pandemic-related closures. But for the traditional events (kitchen fire, burst pipe, neighbouring shop fire causing access restriction), BI is essential. It replaces gross profit minus saved costs (e.g., reduced food orders) over an 'indemnity period' (commonly 12 months).

What it commonly covers

• Fire or flood causing closure for 1 to 6+ months is the dominant claim
• Indemnity period 12 to 18 months is typical (24 months for major venues)
• Pandemic / communicable disease usually excluded post-COVID
• Requires accurate gross profit forecasts, under-insure and the payout is proportionally reduced

Typical sum insured

Replacement value of major kitchen plant, $30k to $200k+ sum insured

Cool rooms, walk-in freezers, ice machines, espresso machines, dishwashers, and ovens are the operating equipment of a hospitality venue. When they fail, the venue cannot trade. Equipment Breakdown, sometimes called Machinery Breakdown, covers the repair or replacement of the equipment AND the spoilage of stock inside a failed cool room or freezer. A single coolroom failure overnight can spoil $3,000 to $15,000 of stock; a multi-day freezer failure during a holiday weekend can be five figures.

What it commonly covers

• Coolroom / freezer breakdown with stock spoilage
• Espresso machine boiler failure (~$2k to $8k repair, days of lost trade)
• Combi-oven failure, high-cost repair, critical to dinner service
• Some policies include refrigerated transport in-vehicle (catering)