Are you covered?

Foodbuy has partnered with Navacord and Selectpath to bring you a new Hospitality Insurance Program

To meet our hotel members ever changing insurance needs, Foodbuy has recently partnered with Navacord, one of Canada’s largest insurance brokers, and Selectpath, to build an exclusive insurance program just for them.

Foodbuy found that a major area of frustration for our members involved insurance, including who they should they choose, types of coverage needed and how to compare pricing.” Troy Taylor, Vice President of Strategic Partnerships and Marketing, outlined the process. “We had a simple goal — to further educate the sector about insurance and help rewrite the insurance agenda to better reflect the realities of the hotel business. We wanted to partner with a company that can offer programs for local hotels as well as high-end, multi-unit chains with complex needs. Navacord and Selectpath were the clear leaders and the best choice for our members.”

The key to choosing Selectpath, a division of Navacord, was their extensive qualifications in this area with hundreds of hotels of all sizes currently in their stable from coast to coast. Selectpath has 25 years of experience insuring hotels and understands their unique needs.

Steve Cox, Managing Partner of Selectpath, explained their process. “I like to call it insurance 101: The risk audit education process. Ultimately, we try to help operators understand what they can do to reduce their insurance rates. We educate operators on the ins and outs of the insurance industry.

“We bring an entrepreneurial approach to insurance, and we re-define the process on behalf of our clients, not the insurer’s agenda. As a result, we hope to breathe new life into a very old-school Industry.”
Selectpath helps operators look at their total insurance package needs including who is underwriting it.

Unfortunately, most operators do not know this information. Cox added, “Everyone has a friend in the insurance business. We find far too often that the broker you are dealing with is employed by the same insurance company who is insuring you. So, whose interest are they really acting on? Yours, or their ‘bosses’, the insurers? You guessed it, certainly not yours.”

Cox continued, “At Selectpath we are not owned by an insurance company. It is just a flat-out conflict of interest, and our mandate is to act 100% for the operator, full stop. The sector can be stuck in the past when it comes to commercial insurance. Therefore, operators are at the mercy of the insurers’ agenda.”

Selectpath’s Risk Audit process is designed to allow the operator to get better visibility on their higher risk areas. Selectpath looks back at policies and claims and then looks forward to developing short and long-term strategies to blend insurer risk appetites, pricing, and terms. Then, Selectpath looks for areas that can help operators reduce risk, which ultimately will lead to reduced premiums.

We asked Cox what he is seeing more of today.

• Rising cost of insurance: This is a key concern. Many feel there is nothing they can do about it. But there is.
• Labour shortages: In most small to mid-sized hotels the operator is managing the business, welcoming guests, and serving food. Managing key risk areas is usually not top of mind. That is where we truly become their agent and supporting business partner.
• Corporate office compliance: Franchises, many of which are US driven entities, are now mandating higher liability coverages. I have seen one chain raise their liability threshold from $6 to $13 million in coverage. That is a big shift for the franchisee and is driving costs up.
• Damage claims: We are seeing more property damage claims, such as water damage from burst pipes or sprinklers, toilets breaking, etc. As hotels age, we are seeing even more issues if they have not been properly maintained.
• Cyber security: As the world moves to become more cashless, there are ample opportunities for hotels to become targets of cyber attack. Wi-Fi hotspots are a big target area. Implementing simple processes such as how often you change passwords plays a factor in your risk.

Cox indicated that there are more bogus claims being launched now against hotels than ever before. We asked if insurers are now pushing back as rates skyrocket. “We are… We are working closely with our domestic insurance companies to have them stop ‘writing a cheque’. We are now taking the third-party claims to task.

And the reason why we are successful is we encourage our hotels to install more cameras. Not only on the exterior of the building but in the interior, common areas of the hotel, including underground parking. This gives us a good defense.”

What sets Selectpath apart is they review your entire business and look at all your potential areas of risk and help to mitigate them. Do you have a gym, pool, restaurant, or  banquet facilities? All of these can play a factor in potential lawsuits or damages. Cox and Selectpath strive to minimize your risks and costs.

“We know operators are looking for relief. We’ve had some great success. We’ve recently written contracts for 17 new hotels and saved them a lot of money on the liability. We look to layer the liability by going with a primary layer, then going with an umbrella layer, to get the desired coverage level. This method can save a lot of money for an operator.”

Cox summarized, “We have developed an area of expertise within the hotel segment. We know the business which provides us the ability to conduct in-depth conversations with the risk management teams. We have the direct phone numbers to the compliance officers.

“We are also working directly with finance companies for the builder risk and wrap ups for hotels. We can satisfy the loan requirements of the risk management firms for the banks. From the time that the shovel hits the ground, we must make sure that they are fully compliant with the lender as well as the brand.

“That’s what sets us apart. We use our size as leverage, just like Foodbuy does. We’re able to address all of our clients’ pain points. We get the job done. “If we can help Foodbuy members become better educated about insurance and have the right supporting policies in place to help reduce their risks and costs, we have done our job.”