Eateries hit with 10 per cent insurance hike
by Leon Gettler
Restaurants and cafes are already hit hard by insurance hikes, and they’re in for more.
According to commercial insurance comparison website BizCover, the price of commercial cover for retailers, which include eateries, has increased 10 per cent over the last year.
While so many other small to medium sized business are picking up cheap insurance because there is so much of it around, the retail sector is doing it hard because of the complexity of the business and less competition.
Generally, the small café or restaurant can pay $1700 for a policy whereas it costs the non-retail business only $1000.
BizCover's latest Small Business Insurance Index rose 5 points during the three months to December, the first increase seen in 10 quarters.
And that, according to Bizcover, means rates will go up in 2016.
Michael Gottlieb, Managing Director of BizCover says prices will go up, but there has to be a limit.
"Insurers are caught in a corner as the increase in rates is necessary due to the increasing claims loss ratios," Mr Gottlieb said. "However, the need for the increase comes at a time of unprecedented capacity in the marketplace and therefore it is unlikely insurers will be able to continue to further push premium rates up."
5th February 2016
