WHY ARE MY LIABILITY INSURANCE PREMIUMS GOING UP???

Escalating liability insurance premiums are the most common concern we hear from our customers at Hospitality Insurance Agency. So while there’s not much we can do to make your concerns go away completely, we’d like to help you understand the two major factors driving premiums up in this market so you can adjust your expectations for your next renewal.

Factor 1:
In December 2011, a major carrier that insures close to 40% of the marketplace decided to exit certain portions of the market. This carrier cited a deterioration in the profitability of the hospitality segment as their reason for leaving the market. This carrier declared the following:

That effective immediately for new business, and effective April 1, 2012 for renewal business (there will be NO “grandfathering” of current risks), they do not wish to insure the following types of business:
• Venues with liquor receipts > 75% of total receipts
• Risks who have filed bankruptcy in the past five (5) years
• Insured whose primary business is a “nightclub” (including Gentlemen’s Clubs and Fraternal Clubs)
• Insureds employing bouncers or security
• Insureds allowing patrons under the age of 21
• Insureds with “mosh” pits or pyrotechnics
• Insureds with a mechanical bull or other riding devices
• Insureds with ANY prior Liquor Liability loss
• Insureds with ANY prior A&B loss
• Insureds with any License revocations or citations

The carrier did cite that they understand that this will put their current hospitality insureds in a difficult position in having to replace coverage but they felt they had no choice based upon the huge amount of liability claims paid out for Assault & Battery, Liquor Liability and Slip & Fall losses that they have incurred.

Factor 2:
The other major carriers in the market, also experiencing these same high levels of claims, have begun to increase premiums across the board to recoup these against these losses. Now once again I hear you: ”We haven’t had any losses at all!” However, the actuarial formulas used by all of the carriers pool together all of the risks in the hospitality marketplace, and they are using that as the basis for their across-the-board rate increases.

Summary:
In summary, the two factors cited above are creating what is called a “hard market.” Pricing is firm and going higher. The market has hardened, and we are warning all of our insureds to expect increases at renewal on their Liability premiums. Zero deductibles are being phased out and replaced with $5,000 minimum deductibles, and the carriers are placing sub-limits on the Assault & Battery (A&B) liabilities as well. If your business has not had prior claims, then there should not be a serious problem obtaining $1MM A&B cover limits at renewals. However, if you have had claims, carriers are moving A&B Limits down to $100k-$300k with $5k-$10k deductibles. As the insurance experts in the hospitality industry, we want to share our forecast for the weather ahead over the next two years: STORMY.

The insurance experts at Hospitality Insurance Agency on your side, and we will continually strive to provide you with the most comprehensive coverages for your premium dollars. If there’s anything we can do to help you better understand Liability premiums or if there are any other concerns you’d like to discuss, please call Pike at 1-800-940-9387 or check out our website at www.HospitalityIA.com.

Next month we plan to bring you the top five actions that you as a hospitality business owner can take to mitigate risks, decrease claims and losses, and, consequently, decrease your insurance premiums.

Until next month,

Pike Barber
Hospitality Insurance Agency

Top 10 Restaurant Start-Up Mistakes!

Thinking of opening a restaurant? Are you prepared to make important decisions? As a new restaurant owner, it is important to know which steps you can take to avoid a disaster.
Avoid These Mistakes Now!

The most common restaurant mistakes that new owners make are usually the ones that play a vital role in the overall success of a restaurant. The following is a list of the Top 10 restaurant missteps.

Avoiding the business plan . For any type of new business, writing a business plan may be the best planning you can do. You may have a great idea, but is it really feasible? Feasibility refers to whether your idea can be turned into a reality. Can your concept make you money? Too many new entrepreneurs avoid the business plan because it takes time to create. The time you spend on the plan is time well spent if it is going to save you from losing all your money. Overall, a business plan is way for you to outline your vision and purpose of the business. It allows you to layout your concept and most importantly review financial projections and investment requirements.
Taking a secondary location . What’s the old saying? You know, location, location, location. That’s right, you know having the right location can either make or break your restaurant. You should never take a secondary location just to save rent. Would you rather save rent or would you rather be closed? The answer is so obvious, so why take the risk? High visibility and accessibility are two key points to having a great location. Unless you’re super famous, don’t think that people will come to find you.
Being closed-minded in concept . You have defined your concept and have a vision for how you want it to look like. From the space layout to the type of furniture to the façade and the décor, you have created a mental picture. Sometimes what you have imagined can’t be fulfilled due to space configurations or other unexpected reasons. Therefore, it is wise to work with your hired professionals; interior designers, architect, engineer and general contractor. Share your ideas with them and get feedback to any foreseen problems. Work together to create alternative plans for your concept. This may in fact be better than your original plans you had envisioned.
Undercapitalization . This is perhaps the most common mistake for new restaurant owners. Underestimating a restaurant’s startup costs can result in bankruptcy. Having a great concept doesn’t prevent you from running out of money. It is always better to overestimate your costs then underestimate. Common problems during startup may include construction delays or changes demanded by building inspectors. To cover such unexpected problems, money should be set aside for working capital which should cover up to one year of rent. In addition, contingency money should also be set aside for any other unexpected problems that may arise. The norm is to set aside 10%-15% of the total investment required for contingency. A good practice is to remain conservative in forecasting your sales and the amount of investment required. Lower your sales forecast and slightly increase the amount of money required.
Believing you will earn money after opening . If you think you are going to make money on the first day of opening, you must be in a dreamland. Even the very best restaurant chains prepare for a loss for the first few months. Even if you achieve fantastic sales from the first day of opening, it is natural to experience high food and labor costs. Within the first month or so, you and your managers are just beginning to get a feel of the business. You can always fix or adjust your food and labor costs, but if you run out of money, you have no where else to go, but perhaps close. Therefore, you need to ensure you have enough money set aside to cover any losses.
Operation, Procedures and Training Manuals . Training plays a critical role in ensuring a restaurant is able to provide consistent service and quality food. Depending on the size of your restaurant, you may have 20 or even over 150 employees. Training takes time and costs money. Don’t stress yourself more than you have to. If you see any franchise restaurant, a system of operations, procedures and training manuals are provided for new franchisees. This allows every employee including the owners and managers to be unified which allows consistency. From detailed recipes, cashier procedures and waiter training manuals, everything to do with the restaurant is outlined. A restaurant that operates without any documented operation, procedure and training manuals will soon find themselves disorganized. Staff training involves constant repetition of procedures. Spend time on creating manuals and save big later.
Focusing on what you like . Finding out what people in the local market enjoy will probably be the best thing you can do. It doesn’t matter what you personally like since you are not the paying customer. New owners are sometimes so focused on wanting what they like to place on the menu that they forget about the market. Visit other restaurants in the area and analyze their menu. This will give you a sense of what the market is like in terms of food and price. You may even want to go one step further and speak to the locals about what they like to do and where they like to go for dining.
Trying to please everyone . You must have gone to one restaurant in your lifetime and wonder why they have a something on their menu that shouldn’t be there. So if you seen this before, don’t repeat the same mistake by trying to appeal to everyone. You will create confusion and complicate the customer by having too many items on the menu. Once you have a concept, you need to define your niche and remain focus in filling that niche.
Lack of preparation on day of opening . The worst thing you can do on opening day is being unprepared. The customer’s first impression is the most important if you want them to return. Before setting a grand opening you should have a few soft openings. These types of openings are often quiet since you haven’t heavily marketed or advertised. This will allow you to work out any immediate kinks or any foreseen problems. When its time to have your official grand opening, schedule extra staff as you never know what will happen.
Owners failing to be an owner . A good owner is one who can manage the business well. Sometimes new owners act like they are one of the employees. Assisting your staff in serving, cooking and cleaning are all great and it doesn’t mean you can’t. However, it’s important to be able to manage the business by maintaining an active role in analyzing the P&L, monitoring cash flow and making strategic decisions that will affect the business. If you are always helping your staff, who will manage your restaurant?

Plan to avoid restaurant missteps

There may be many more restaurant mistakes that you can think of but these are some of the most common ones that new restaurant owners make. I have experienced working in different managed restaurants with each restaurant owner having shared at least one or more of these missteps. Proper planning is perhaps the most important aspect to a new restaurant startup. Get organized, be prepared and know your role. With these three steps in mind, you will be well ahead.

Hospitality Insurance Agency to Attend 2012 Nightclub & Bar Show in Las Vegas

Press Release
FOR IMMEDIATE RELEASE

Hospitality Insurance Agency to Attend 2012 Nightclub & Bar Show in Las Vegas

TAMPA, FL – January 5, 2012 – The Hospitality Insurance Agency, with offices in Tampa Bay and Las Vegas, are pleased to announce that they will be attending the 2012 Nightclub & Bar show in Las Vegas, NV. The show will take place from March 12-14 and will be at the Las Vegas Convention Center.

The Nightclub and Bar Show is one of the largest restaurant and hospitality industry trade shows in the United States. Visit the Hospitality Insurance Agency at booth number 138 to meet with one of our experienced insurance professionals to discuss all of your hospitality insurance needs.

We are pleased to offer attendees the opportunity to meet Robert “Pike” Barber, Founder and President of Hospitality Insurance Agency. Come meet Pike and learn how he can personally assist you in designing the perfect insurance package for your business’ needs. Discover why Hospitality Insurance Agency is the one place that not only understands your industry, but more importantly, understands why and how it needs to be protected.

Hospitality Insurance Agency is a leading hospitality and entertainment insurance broker providing insurance coverage and services for the hospitality industry including nightclubs, bars, gentleman’s clubs, hotels & motels and restaurants.

For more information about Hospitality Insurance, visit our website at http://www.hospitalityia.com or call us directly at 800-940-9387.

About Hospitality Insurance Agency
The Hospitality Insurance Agency has been serving the public since 1948. That’s three generations of providing the utmost in professional insurance advice and service to every sector of the hospitality industry. We base our relationships upon trust, honesty and mutual respect. It is an adherence to those values along with vast knowledge, stability and expertise that has guaranteed client satisfaction for a combined total of over 100 years.

CONTACT:
Hospitality Insurance Agency
Email: info@hospitalityia.com
URL: http://www.hospitalityia.com

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Hospitality Insurance Agency Receives 2011 Best of Oldsmar Award

Press Release

FOR IMMEDIATE RELEASE

Hospitality Insurance Agency Receives 2011 Best of Oldsmar Award

U.S. Commerce Association’s Award Plaque Honors the Achievement

NEW YORK, NY, December 14, 2011 — Hospitality Insurance Agency has been selected for the 2011 Best of Oldsmar Award in the Business Insurance category by the U.S. Commerce Association (USCA).

The USCA “Best of Local Business” Award Program recognizes outstanding local businesses throughout the country. Each year, the USCA identifies companies that they believe have achieved exceptional marketing success in their local community and business category. These are local companies that enhance the positive image of small business through service to their customers and community.

Various sources of information were gathered and analyzed to choose the winners in each category. The 2011 USCA Award Program focuses on quality, not quantity. Winners are determined based on the information gathered both internally by the USCA and data provided by third parties.

About U.S. Commerce Association (USCA)

U.S. Commerce Association (USCA) is a New York City based organization funded by local businesses operating in towns, large and small, across America. The purpose of USCA is to promote local business through public relations, marketing and advertising.

The USCA was established to recognize the best of local businesses in their community. Our organization works exclusively with local business owners, trade groups, professional associations, chambers of commerce and other business advertising and marketing groups. Our mission is to be an advocate for small and medium size businesses and business entrepreneurs across America.

SOURCE: U.S. Commerce Association

CONTACT:
U.S. Commerce Association
Email: PublicRelations@uscaaward.com
URL: http://www.uscaaward.com

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Florida’s Minimum Wage set to rise on Jan 1st

By PETER BERNARD | News Channel 8
Published: October 18, 2011
Updated: October 18, 2011 – 5:32 AM
» 70 Comments | Post a Comment
ST. PETERSBURG –

Florida’s minimum wage is set to rise as the ball drops in Times Square.

Starting January 1, employers in Florida must pay workers $7.67 an hour, up from $7.31. Tipped employees, such as restaurant servers, will see their wage go from $4.29 an hour, to $4.67. The new rates will mean an extra $14.40 per week for someone who works 40 hours.

Courtney Christie, who works part time at “Three Birds Tavern” on 4th Street North in St. Petersburg, said the new wage rate won’t change her paycheck by much.

“It’s not that big of a difference. So I mean it probably won’t change a lot,” she said. “But more is better than less.”

Christie said her tips far surpass the money she makes in wages.

Restaurant co-owner Robin King said the wage boost is appropriate for her servers and bar employees. But she warns that when it comes time to set menu prices, the minimum wage boost will be taken into consideration.

“We feel like it’s our responsibility to keep our pencils sharpened to keep the prices as tight as we possibly can and approachable for the customers.” King said. “But we also ask the customers to keep in mind that everything’s going up for us, too.”

Casino’s Coming to Florida??

Douglas C. Lyons Sun Sentinel Senior Editorial Writer

October 22, 2011

Somewhere deep, deep, deep in the bowels of our state capitol, someone should be making space for the commemorative busts of two state lawmakers, one of them Broward County’s very own Ellyn Bogdanoff. The Fort Lauderdale Republican is poised to become a significant “job creator.”

If you believe the hype coming out of the GOP, government doesn’t create jobs, but Bogdanoff and fellow Republican state Rep. Erik Fressen, R-Miami, didn’t get the memo. The two are putting the finishing touches on an omnibus gambling bill that, in the words of one veteran capitol staffer, ” … is the biggest money bill the Legislature’s seen in perhaps 20 years.”

The promise of heavy duty lobbying — more importantly the campaign contributions that come with it — hangs over the capitol like pollen in the springtime. Odds are the bill stalls in the Florida House its first time out, but the beauty is that passage will take time — at least two, possibly three years before lawmakers make destination casinos in Florida a reality. Talk about a stimulus package.

Douglas C. Lyons
Douglas C. Lyons
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The bill is expected to allow three new Las Vegas-styled casinos to open in Broward and Miami- Dade counties. It also creates a new government bureaucracy to regulate them. It’s the second major gambling bill, joining one filed by state Sens. Maria Sachs, D-Delray Beach and Dennis Jones, R-Seminole, that allows five Las Vegas-styled casino hotels spaced across the state.
Video: Mother of pit bull attack victim discusses son’s condition

The stakes are huge. Genting East Coast USA Inc., a subsidiary of the Malaysia-based casino group, anounced plans to build a $3.5 billion resort in Miami, and the Las Vegas Sands Corp. is also eyeing Miami for a new resort. Both firms believe casino gambling will boost employment in South Florida and cement the region’s stature as a bona fide tourist destination.

Still, the salivating right now is taking place in the halls of the state capitol.

To pass legislation like the one our two South Florida Republicans are carrying, you need lobbyists, lots of lobbyists. There also will be work for attorneys to make sure any amendments, changes and tweaks pass legal muster, and how could I forget the public relations and media specialists who will be hired to either spread the good news of gambling or condemn it as another sign of the Apocalypse.

You can bet the Genting, the Sands, and any other big casino operators will have their legions of paid advocates. So will The Diplomat in Hollywood and the Fontainebleau on Miami Beach. Broward and Miami-Dade counties will be respresented, as will the parimutuels, like Gulfstream Park and the Palm Beach Kennel Club and those parimutuels who have felt shut out of Florida’s recent gaming opportunities.

The Seminole Tribe of Florida, owners of The Hard Rock Hotel & Casino in Hollywood, are already paying the state millions as part of an ongoing gambling compact that could go away if the casinos move in. The Miccosukee are also keeping an eye on their interests.

The Florida Chamber of Commerce and the Florida Restaurant and Lodging Association are just two of the heavy hitters in Tallahassee that will weigh in, and you can bet on an army of suits representing the interests of the Walt Disney Co. and the convention and tourist industry types in the Orlando area who won’t tolerate any losses in their convention and regional conference business to South Florida.

We’re talking big bucks here.

Bogdanoff can take pride in pushing a measure that in the long run will generate thousands of new jobs for Floridians, and bring some much-needed order to the hodge-podge of oversight that passes for state government regulation of gaming. Florida could use an ample dose of both jobs and oversight.

In the meantime, a part of the state capitol job market will let the good times roll. “Follow the money,” I’ve been told. “You can’t miss it.”

Douglas C. Lyons can be reached at dlyons@sunsentinel.com, or 954-356-4638. Follow him on twitter@douginflorida.

Copyright © 2011, South Florida Sun-Sentinel

Welcome to our NEW blog!

Hospitality Insurance Agency is proud to launch our new blog, the VIP Club!  You’ll still be able to access all of the content from our old blog, but we’ll soon be bringing you additional content about the hospitality industry and insurance issues that may be affecting you.  Just like your VIP customers receive special attention, we’ll be giving you special attention here in our very own VIP Club. We hope that you’ll find our new blog to be a valuable resource and just another reason why Hospitality Insurance Agency is your best resource for bar insurance, nightclub insurance, gentleman’s club insurance, hotel/motel insurance, and restaurant insurance.  If there’s anything we can do to help you, please don’t hesitate to contact us!

Girls Gone Wild Contest in Downtown Plattsburgh!?

THERAPY NIGHTCLUB in Plattsburgh is hosting its first Girls Gone Wild!! Video Crews and young adults will come to the nightclub on Friday April 15, for the contest. Club owner, Jimmy Taber is getting some resistance from the community. However, this is supposed to be strictly for model searching. There will not be any wild or risque actions. The community is saying that it is not a good idea, however, are satisfied with the business that it will bring to downtown. The club opened in July 2010 with 30 employees, it now has 4 regular employees. So there is definitely a cause for some type of event, it is expected to draw 200-300 people. What are your thoughts on this?

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$800,000 Dollar Lawsuit From Nightclub Death!!

One night at Fat Daddys by the Woods a man stepped in the middle of a fight to break it up. When the bouncers got there he was involved with the situation. With that in mind, he was asked to leave the nightclub. He refused to leave and threatened bouncers. The bouncers took him outside and sat on him while the bouncers “taught him a lesson.” David A. Potter, 27, was killed from not being able to breath. The bouncers sat on him long enough to kill him. The death was ruled accidental and there were no reasons to press charges against the business or the employees. The brother of Potter filed a civil lawsuit for $795,000 dollars, 7 years ago. Today, he won the case for $800,000 dollars. The money will be used for the 2 sons of David A. Potter.

What do you think about this!? A guy tries to break up a fight at a nightclub and the bouncers take him outside and kill him!!! The coroner rules the death accidental!?!? He was being sat on, how is that accidental?? Well at least 7 years later they won the case. Now the kids will at least have some college money from the business who killed their father.  What are your thoughts!?

 

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Shooting At Richmond Nightclub Leaves Victim Dead!?

A victim was shot at a nightclub the other night and died of injuries! Police said there was a arguement that started inside the nightcub and was later brought out into the parking lot where the one party was shot. Police found him on the side of the road around 12:51. He was transferred to VCU Medical Center, but it was too late. Police are still looking for the suspect. They said he is a 19-25 year old black male with light complexion and around 6’0. This is the 8th homicide in Richmond so far this year.

 

What are your thought on this!? 8 murders so far this year in Richmond. Thats just about one per week!! Something needs to be done. They need to close the clubs earlier, have more security, or come up with something that will stop. In Tampa, there are cops everywhere in the club sections. It is not good sometimes, but it stops people from getting killed. What are your thoughts.

 

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