Karaoke Bar Business Insurance
Getting insurance for your karaoke bar is essential.
Karaoke bars need to be protected against claims arising from things like noise complaints, liquor liability, and personal injury.
For example, a patron is injured after falling off of a karaoke platform, or a group of rowdy individuals cause property damage to your bar.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for a Karaoke Bar
General liability insurance is — generally speaking — one of the most important insurance policies for karaoke bars.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
General liability should form a central part of your karaoke bar’s protection. Some other key policies to add to your coverage include:
- Liquor liability insurance: Since alcohol will likely be sold at your venue, and alcohol-related incidents are not covered by general liability, this policy is invaluable.
- Commercial property insurance: The cost of repairing any damage to business real estate or other property by a covered event will be taken care of by this policy.
- Business interruption insurance: Forced closure for even a short period of time can spell danger for any business. This policy can help you keep afloat should a major loss occur by covering a portion of lost income.
If you are trying to decide where to buy coverage for your karaoke bar, it is important to bear in mind the two main types of insurance providers:
- Traditional brick-and-mortar insurers
- Online insurers
Although traditional insurers have historically been more popular, online insurers (such as Tivly and Next) are currently the preferred choice because they offer similar quality insurance more affordably.
Find the Right Policy at the Best Rate
We’ve reviewed and tested the major business insurance providers. Let us help you find the best match for your business.
Cost of General Liability Insurance
On average, karaoke bars in America spend between $500 - $1,200 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a karaoke bar to other professional industries using the graph below:
Several factors will determine the price of your policy. These include your:
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
Start an Online Quote for Insurance
Finding the most affordable premium starts with getting accurate quotes from highly rated providers.
Common Situations That General Liability Insurance May Cover for a Karaoke Bar
Example 1: There is an altercation during a karaoke contest in which three people are injured and some personal property is damaged as well. Two people are suing for medical costs, and one is suing for damaged property. Your general liability insurance should cover these costs. It’s important to note that some general liability policies have an “expected or intended injury” exclusion. Discuss this with your insurance agent prior to purchasing.
Example 2: Your redesigned logo catches the eye of a business owner with a very similar copyrighted logo. He claims you are guilty of copyright infringement and threatens to sue. A general liability policy would cover the costs of defending yourself in the lawsuit, as well as any potential payout.
Example 3: You are trying to get a loan to expand the karaoke bar, but the bank requires all customers to carry a minimum amount of general liability insurance. Having a policy would help ensure your loan eligibility.
Check out our review of the Best Small Business Insurance Companies.
Other Types of Coverage Karaoke Bars Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some other types of insurance all karaoke bars should obtain:
Liquor Liability Insurance
Many general liability policies exclude coverage for events related to alcohol. Therefore, it is recommended that all bar owners purchase liquor liability insurance. This will ensure proper coverage should a lawsuit arise that falls within the fine line between liquor liability and general liability coverage.
Commercial Property Insurance
Commercial property insurance will help cover the cost of repairing damage to owned real estate or replacing equipment and inventory that is damaged in a covered event, such as a fire.
Workers’ Compensation Insurance
While coverage requirements vary, most states requires businesses to carry workers’ compensation for each employee. In the event of an accident at work, the policy would cover medical expenses incurred by your team member. Additionally, workers’ compensation insurance offers coverage for attorney’s fees, settlements, and the employee’s lost wages.
Workers compensation is most often purchased as a standalone policy.
Business Interruption Insurance
Your insurance company may offer business interruption as part of their business owners’ policies (BOP). Should a major loss occur, such as in the event of a hurricane, this policy would assist in getting the business back to serving customers again. It can cover the costs of moving to a temporary location and can also make up a portion of revenue that is lost while your business is not operating.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your karaoke bar:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Business Insurance Is the Best Way to Protect Your Business
If you're starting a new business, then you need business insurance. It's as simple as that. The protection offered by an LLC will protect your personal assets, but your business's assets are still open to liability in the case of a lawsuit or other loss.
Be sure that everything you've built is safe by getting business insurance.
Karaoke Bar Business Insurance FAQ
Can I buy business insurance online for my karaoke bar?
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
What is included in a business owner’s policy?
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
What is the difference between business insurance and general liability insurance?
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Do I need insurance before I start a karaoke bar?
Yes. A karaoke bar is exposed to a unique set of risks that threaten its financial stability. The best course of action is to preemptively acquire business insurance to protect against these risks.
Certain insurance policies will even have the added benefit of maintaining your karaoke bar’s compliance with state laws, such as workers’ compensation insurance.
Will insurance protect my karaoke bar from everything?
Not necessarily. Certain exceptions may be written directly into your karaoke bar insurance policy, and some perils may be entirely uninsurable.
Do I need business insurance if I already have an LLC?
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.