Resort Insurance

Some of the top factors that affect the cost of resort business insurance include:

• Recreational activities offered: It costs more to insure a resort that has horseback riding, kayaking, or snowmobiling than one with less risky amenities like a restaurant or fitness center.
• Annual revenue: Businesses that earn more revenue are associated with costlier claims, which means they pay more for insurance.
• Number of employees. A larger workforce brings a higher risk of employee accidents and mistakes, which raises the cost of workers' compensation, general liability, and similar policies.
• Property type and value: The value of your buildings and other property, such as a golf course or a marina, determines how much you pay for property insurance.
• Business location: Localized factors such as crime rates, healthcare costs, foot traffic, risk of natural disasters, and property values can impact your insurance premiums.
• Safety guidelines: Insurers may offer lower rates to resorts that have strict equipment certification and safety protocols for pools, spas, watercraft, etc.
• Risk management: Businesses that implement video surveillance, sprinkler systems, and other security measures, including cybersecurity controls, usually have lower premiums.
• Policy limits and deductibles: Insurance policies with higher limits and lower deductibles provide better protection, but come with a higher premium.
• Claims history: A resort that has filed an insurance claim in the past will cost more to insure than one with a clean claims history.

License and permit requirements vary depending on where your resort is located and the types of amenities you offer. Each state, county, and city has its own laws and regulations that could impact your business.

Here are some examples of what resort owners typically need:

• Business license. Every business owner needs a general business license to operate legally.
• Lodging license. A hotel or lodging license ensures certain standards and grants permission to offer public lodging.
• Sales tax permit. A sales tax permit allows your resort to sell room rentals and retail goods.
• Health permit. A permit from your local health department shows compliance with health and safety standards for food service.
• Entertainment permit. This permit allows you to host live music or other entertainment on a regular basis.
• Liquor license. Resorts that sell or serve alcohol usually need a liquor license.

Keep in mind, some areas are more strict than others. You'll need to make sure your business is in compliance with local zoning ordinances, fire and safety codes, signage regulations, Americans with Disabilities Act (ADA) standards, water use regulations, and more.

Resort insurance provides essential protection for your business, and it's often required by laws and contracts. Each guest brings the chance of an accident on your premises—and your resort could end up responsible for medical bills, legal costs, or court-ordered damages.

Here are the policies that resorts usually need:

• General liability insurance, also called public liability insurance, covers third-party bodily injuries and property damage, including skiing, boating, and golfing accidents. You might need proof of liability insurance to obtain a license or permit, sign a commercial lease, get a business loan, or operate a resort franchise.
• Workers' compensation insurance is required in New York, California, and most other states as soon as you hire your first employee. It pays for medical treatment if a worker is injured on the job and provides them with disability benefits while they're recovering.
• Commercial auto insurance covers accidents involving business vehicles. Almost every state requires this coverage for vehicles owned by a resort.

You may need additional types of insurance depending on the services you offer. For example, resorts that sell alcohol should carry liquor liability insurance, while you should have malpractice insurance if your resort has a med spa or similar service that could lead to professional liability claims.

In most states, resorts must provide workers' compensation coverage for all of their employees—including those who work seasonally or part-time. Workers' comp is often affordable for these types of workers, as insurers look at your payroll when calculating your premium.

You can also buy short-term liability insurance if your resort hosts special events like fundraisers or private parties, or operates only during specific seasons.

However, there are several reasons to opt for year-round coverage instead:

• It's expensive to stop and start coverage. Businesses that cancel their policies may see increased premiums or have difficulty restarting coverage, as it's a red flag for insurers.
• It may cost more in the long run. Going without insurance leaves you exposed to costly risks. For example, a fire at a ski resort that's closed for the summer could destroy lifts and other property.
• Some policies won't provide coverage. Occurrence-based policies like general liability continue to cover incidents that happened while you were insured, but that's not the case for claims-made policies like professional liability insurance, which must be kept active to provide protection.

Yes, travelers who visit your resort are covered under your general liability policy, which helps pay for slip-and-fall injuries and other common accidents.

Most general liability policies include product liability insurance, which covers harm caused by your resort's merchandise and other products. However, you need to add bailee coverage to your policy to protect luggage and similar items in your care.

General liability insurance typically covers a wide range of incidents, such as:

• A visitor slips at your pool and suffers a concussion
• A bellhop drops a guest's bag and breaks their laptop
• An employee posts a customer's photo on social media without their permission
• A guest comes down with food poisoning after eating at your concession stand

In some cases, you might need an endorsement to cover risks outside of normal business operations, such as skiing or ziplines. Insureon's licensed agents can answer your questions and help you find specialized insurance coverage that meets your needs.

Resort owners often invest in the following insurance products to protect against unexpected out-of-pocket costs:

• Commercial property insurance covers burglaries, fires, storms, and similar events that cause property damage or losses. You can add business interruption insurance to cover temporary closures tied to property claims.
• Equipment breakdown insurance protects against financial losses caused by the sudden failure of an air conditioner, pool filtration system, or other important resort equipment.
• Inland marine insurance protects items in transit and used off-site, such as golf carts, snowmobiles, mobile stages, and landscaping equipment.
• Crime insurance helps pay for losses from employee theft or fraud, such as theft from a cash register.
• Employment practices liability insurance (EPLI) pays for legal fees related to violations of employee rights, such as unfair hiring practices or wrongful termination.
• Directors and officers (D&O) insurance protects your board members and officers from legal costs related to the decisions they make on behalf of your resort. You can bundle it with other types of management liability insurance, such as EPLI.
• Hired and non-owned auto (HNOA) insurance covers auto accidents involving personal, rented, and leased vehicles used for business purposes.
• Commercial umbrella insurance, similar to excess liability insurance, provides additional coverage when the limit is reached on another liability policy, such as general liability insurance.

Our agents can help you find any specialty insurance policies you may need and answer your questions about resort insurance.