Contents Coverage
Contents Coverage, also known as Business Personal Property coverage, is a type of commercial property insurance that protects the movable property and equipment your restaurant owns — kitchen equipment, furniture, POS systems, dishes, linens, decor, and inventory. It pays to repair or replace these items if they're damaged, destroyed, or stolen due to a covered peril like fire, theft, vandalism, or water damage.
What You Need to Know
Contents coverage is one of the most commonly undervalued components of restaurant insurance. Many owners base their coverage on rough estimates or outdated equipment values, only to discover after a loss that they're severely underinsured.
What contents coverage protects:
- Kitchen equipment — cooking, refrigeration, food prep, and dishwashing equipment
- Dining room furniture — tables, chairs, booths, bar stools, host stands
- Point-of-sale systems, computers, tablets, and card readers
- Dishes, glassware, flatware, linens, and decor
- Food and beverage inventory in storage, prep, or ready to serve
Replacement cost vs. actual cash value: replacement cost coverage pays the full cost to replace items new, while actual cash value coverage pays replacement cost minus depreciation — often 30-50% less. Most restaurant contents depreciate rapidly, so a 5-year-old fryer might be worth far less under ACV than what it costs to replace.
Why It Matters for Restaurant Owners
A fully equipped commercial kitchen alone can represent a massive financial investment, and that doesn't include dining room furniture, your POS system, inventory, or decor. If a fire or theft wipes it out, you could lose everything overnight.
Common underinsurance scenarios:
- Basing coverage on purchase price instead of current replacement cost
- Not updating coverage as equipment is added or replaced with pricier models
- Forgetting accumulated smallwares — plates, glasses, and utensils add up
- Underestimating custom furniture value
- Excluding recently purchased items not yet added to the policy
Maintaining a detailed, photographed inventory with current replacement costs and reviewing your coverage annually is the best way to avoid discovering a coverage gap only after a loss.
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