What to do when restaurant and hotel customers can’t find coverage

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Commercial brokers who want to cover restaurants and hotels need to understand how these customers have been affected by the pandemic and best present their risk profile to carriers, said the CEO of the Insurance Brokers Association of Saskatchewan.

During the pandemic, some Saskatchewan brokers “had very, very difficult conversations with clients who were unable to pay their premiums, were unable to find cover in a particularly difficult market” said IBAS CEO Derek Lothian. 18 in an interview.

Separately, brokers and managing general agents declared Canadian Underwriter that some insurers no longer cover restaurants, hotels, motels and event venues.

A broker has to do a good job of understanding how the pandemic has affected individual clients and making the best case for those clients when they take their risks in the market, Lothian said.

“You had people who literally couldn’t open their doors for months at a time. Combine that with bonuses that went up 30%, 60% or more, ”Lothian said of the hospitality industry.

Many carriers no longer offered coverage, leaving the broker and client unable to find new coverage.

Lothian was interviewed about the importance of community engagement for brokers. In many cases, brokers budgeted marketing funds for events that could not take place.

For its part, IBAS launched a campaign in 2021 in which brokers have provided funding – approximately $ 45,000 so far this year – to 13 different community organizations across the province to improve outcomes in Mental Health.

On the commercial hospitality front, IBAS worked with the Insurance Bureau of Canada to pilot a risk management service for the hospitality industry, Lothian said.

In early 2020, IBC announced that it would hire a risk manager who could make practical recommendations to condominium companies to reduce their risk. In late 2020, IBC extended its risk management advice to the hospitality industry as part of an effort to address the fact that some insurers are pulling out of the hospitality market and commercial rates are rising.

Large Regina hotel was “very close to not being able to get insurance,” Lothian said Canadian Underwriter. This hotel was considering closing, but thanks to IBC, the hotel was able to get a second look from an insurer.

“They were able to translate the situation better to insurers” and show that the risk was “much more attractive” than an insurer had perceived, suggested Lothian.

Featured image via iStock.com/Wavebreakmedia

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