A recent survey by Jones Lang LaSalle Hotels has noted considerable variations in the premiums placed on hotel owners for public liability and industrial special risk (ISR) insurance.
“The findings should serve as encouragement to hoteliers. To reduce their premiums, operators and owners alike should take actions to minimise the risk profile of their hotels. The findings also highlight the importance of shopping around when seeking coverage” Mr Troy Craig, Senior Vice President, Jones Lang LaSalle Hotels.
The survey revealed that insurance premiums have increased by up to 200% for some 4 to 5 star hotels in Australia.
“Over the past month we have surveyed numerous financial controllers, at both the hotel and corporate level, operating in city and resort markets across Australia. With few exceptions and not unexpectedly, the results show that public liability and ISR insurance premiums have increased significantly over the past year. What was surprising was the extent of the increases,” said Mr Craig.
Approximately 80% of those surveyed indicated that their public liability premiums had increased by between 140-200% over the previous year. All respondents said that ISR insurance premiums had generally increased by between 80-100%, but increases as high as 200% were also recorded.
“The current increases obviously do not come at the best of times for hoteliers who, in some cases, are already struggling under the pressure of softer market conditions arising from flat corporate demand, lower international arrival numbers and increased room supply in several Australian markets” Mr Craig said. “The recently announced changes to public liability laws give hope for lower premiums from next year.”
In the meantime, hoteliers can take active measures to minimise their risk profile and therefore the premiums charged. Such measures include: - Systematic risk reporting structures;
- Adequate signage highlighting potential hazards;
- Accident case management plans;
- On-going and systematic safety reviews;
- Video taped security cameras in public areas;
- Staff training programs regarding risk minimisation; and,
- On-going repair and maintenance programs to ensure that potential hazards are identified and removed.