Company insurance is intended to safeguard the financial assets of a business owner and is a necessary investment for a hotel.

Company insurance is intended to safeguard the financial assets of a business owner and is a necessary investment for a hotel.

This article will discuss the primary insurance coverage for hotels, general liability insurance, as well as additional policies that are appropriate for this industry.

Motel General Liability Insurance

Every firm, regardless of sector, has risks that should be insured. General liability insurance is the most frequent and comprehensive form of coverage that company owners purchase.

General liability insurance covers the following risks:

Physical harm

Damage to property

Medical expenses

Legal defence and decision

Personal and commercial harm

While general liability insurance is not legally needed for companies, operating without it is exceedingly dangerous. If your company is sued, you might face costs in the hundreds of thousands of dollars (or more). The only way to avoid this sort of catastrophe from destroying your organisation is to have an adequate general liability insurance coverage in place to assist pay for these losses.


Example 1: A visitor enters your hotel lobby after a staff drops a bottle of water on the floor. The expense of the guest’s medical costs will be covered by general liability.

Example 2: A visitor gets attacked by bed bugs while staying at your hotel. When someone gets inside their suitcase, their automobile becomes infected with bed bugs. General liability insurance may cover medical or extermination expenses.

Example 3: You want to become a franchisee for a major hotel brand, but first you must fulfil their insurance criteria. Having the appropriate quantity of general liability coverage will guarantee that you satisfy the requirements of the parent firm.

Of course, this is not an entire list of risks covered by a general liability insurance policy, and certain situations may result in a specific peril not being covered. To minimise coverage gaps, it’s always better to speak with your agent about the terms of your policy.

General Liability Insurance Cost

Motels in the United States typically pay between $350 and $700 per year for $1 million in general liability insurance.

The cost of your coverage will be determined by a number of variables. Among them are your:



Employees’ number

Per-occurrence restriction

The overall aggregate limit

You may be able to get general liability insurance at a lower cost if you buy it as part of a business owner’s policy (BOP) rather than as a separate policy. A business interruption policy (BOP) is a more complete option that covers numerous types of coverage, such as business interruption and property insurance.

Other Types of Insurance Required by Motels

While general liability insurance is the most crucial, there are various different types of coverage to be aware of. Other forms of insurance that all hotels should have are listed below.

Insurance for Commercial Property

Your property is the foundation of your company. Commercial property insurance will cover the expenses of repair and restoration if it is damaged in any manner. It will also cover the contents of your property, which means it may assist you with replacing the outside and interior structure of your building, as well as any lost, stolen, or damaged products contained inside.

Insurance for Business Interruption

If you have to shut your hotel due to a natural catastrophe or serious vandalism, this kind of insurance will reimburse you for the average amount of revenue you would have earned if your motel had remained open. If you reside in a weather-prone location, this insurance might be vital to keeping your company solvent if you have to shut for many weeks at a time.

Insurance for Workers’ Compensation

Workers compensation insurance protects your workers if they get hurt on the job. If your workers are subjected to extremely rigorous labour, you may wish to acquire coverage in excess of the legal minimum.

Coverage Options Available to Motels

In addition to the insurance listed above, your hotel may need other forms of coverage based on particular elements of your business. Some of them may not apply to you, so be sure to ask your agent whether policies are appropriate for your company.

Umbrella Liability Insurance for Businesses

This kind of insurance is provided to give additional protection over and above a general liability coverage. If a significant allegation is made against you, you will be provided with the legal resources you need to either fight the accusations or settle them out of court. A general liability coverage may only cover a few days in court, while umbrella insurance may cover many months.

Insurance for Data Breach

If your visitors book online, data breach insurance may help you cover the expenses of a cyberattack or data breach. This insurance may safeguard both your company and your consumers in the event of financial theft or fraud.

Insurance for Liquor Liability

If you have a restaurant on the premises or sell liquor in any form, liquor liability insurance will protect you against acts taken by customers who are under the influence of alcohol.

Additional Security Measures for Your Company

Although investing in company insurance is simple (and necessary), it should not be your first line of defence. Yes, insurance will reimburse your company for cash losses incurred as a result of an occurrence, but it is much preferable to avoid losses altogether.

With this in mind, here are a few steps you can take to better secure your company:

Make use of legally binding contracts and other business agreements. (We provide free templates for several of the most often used legal forms.)

To safeguard your personal assets, form a limited liability company (LLC) or a corporation. (To discover how to incorporate an LLC or company in your state, see our step-by-step tutorials.)

Keep your company licences up to date.

Streamline the internal procedures of your company. This will eliminate unneeded variables from routine activities and establish a secure, consistent environment in which to do business.

If your company is an LLC, you should check into LLC insurance.