Greater Sudbury restaurant sees insurance rates double, a growing problem across the industry
SUDBURY -- A restaurant owner in Greater Sudbury is speaking out about a huge increase in his insurance premiums, even as COVID-19 is hitting restaurants hard across the country.
Chris Vitiello, owner of Cousin Vinny's Restaurant and Bar in Hanmer, said rates for some restaurants and bars are going through the roof at a time when many are struggling to survive.
Vitiello said his recent insurance renewal rate was outrageous – five times higher than what he paid before. He shopped around and found a new carrier, but is still paying more than double his previous rate.
"We're obviously suffering in this industry and all of a sudden our insurance rates just doubled," he said. "Now this was the best rate that I could find. The original quotes in the industry were almost 500 per cent higher."
Vitiello said his insurance should have gone down with so many factors stemming from the pandemic hitting restaurants and bars hard.
"With limited hours, drastically reduced sales, and also a big thing in this industry is the food-to-liquor ratio, and we are currently doing almost 90-95 per cent food, which should help our numbers not make them worse," he said.
Cambrian insurance was not the broker involved in Vitiello's policy, but agreed to talk to CTV about commercial insurance in general and what's happening right now.
"Commercial property has been a tough class because of a lot of natural disasters," said Trevor Blanchard, a commercial lines manager with Cambrian Insurance. "Floods, fires, forest fires, a lot of things are making the loss ratios of insurance companies drastically increase."
Big issue for the industry
CTV News talked to Restaurants Canada, which confirmed skyrocketing insurance rates are a big issue right now.
"Rising insurance rates and plan cancellations have been experienced across the country by restaurants that are in a dire situation due to the pandemic," said James Rilett, vice-president of Restaurants Canada.
"Operators have been hit with a double whammy, as their claims for business interruption insurance were denied by the same insurance companies that are now asking for huge increases. Restaurants Canada is talking to the Insurance Bureau of Canada and insurance industry executives in an effort to find solutions to the issue that could force many restaurants out of business."
Vitiello points out that auto insurance is regulated by the province, but property insurance is not. He would like to see that change to stop what he calls “exorbitant” premium increases.