Restaurant insurance coverage is an important investment for a restaurant owner to make. However, restaurant owners sometimes make insurance mistakes that end up costing them a lot of money.

The following are six mistakes you need to avoid when you purchase restaurant insurance to avoid costly problems down the road.

1. Neglecting to analyze the unique set of risks your restaurant faces

Every restaurant is different. You need to analyze the unique characteristics of your restaurant in determining what insurance coverage you need. For example, does your restaurant also host entertainment events? Do you serve alcohol or are you a BYOB restaurant? Does your restaurant cater to special events? All of these factors can mean additional insurance coverage needs. Make sure you discuss all of the activities your restaurant is involved in with a representative from your insurance company to devise a policy that is right for your unique restaurant setup. 

2. Selecting a particular restaurant insurance policy before understanding it fully

Before you purchase a policy, make sure you haven't skimmed over any important details. Read the fine print and don't be afraid to ask questions if there are any issues that you need to have clarified. 

3. Overlooking a key type of coverage

There are numerous types of insurance coverage that restaurant operations need. These include liability, property, workers comp, and commercial auto coverage. Consider all the main types of commercial insurance and determine whether you need them or not. 

4. Not paying enough attention to your restaurant's location

The location of your restaurant is a significant factor when it comes to your restaurant's risks and liabilities. Is your area prone to flooding? Is your area prone to vandalism or power outages? Keep all these factors in mind when deciding on the terms and coverage amount of your insurance policy. 

5. Neglecting to adapt your restaurant insurance policy to growth in your business over time

Don't think that you only need to make insurance decisions once for your restaurant. It's important to realize that your restaurant's insurance needs could change and increase over time as your business grows. It's important to periodically reevaluate your insurance policy to see if you need to add on coverage to keep up with company growth. 

6. Purchasing commercial insurance from a company that doesn't specialize in insuring restaurants

Restaurants are a unique type of business. They face liabilities that other types of commercial ventures don't face. That's why you should purchase restaurant insurance from a company that specializes in insuring restaurants rather than a company that simply offers general commercial insurance.