Bed and Breakfast Startup

Hi,

I’m in college and working on a project for a commercial recreation class. Our project is to conduct a feasibility study and create a business plan on a mock business. We’re opening and operating a Bed and Breakfast in Illinois as our project.

But we’ve ran into a problem with getting estimates for insurance. I’ve found plenty of insurance companies that offer B&B insurance, but they issue quotes for actual businesses. It’s not like they have a pricing list on their website. And I don’t think they’d appreciate writing up an insurance quote for a fake college project!

I’ve got the types of insurance needed, but have no idea how much coverage is needed or what an insurance policy is likely to cost. The property is worth $500,000. Here’s a list of what I have so far:

-Business Personal Property Coverage
-Business Income and Extra Expense Coverage
-Ordinance or Law Coverage
-Guest Inconvenience Coverage
-Guests’ Property Insurance
-Personal Liability
-Replacement Cost Coverage
-Business Auto Insurance
-Worker’s Compensation Coverage
-Liability Insurance
-Building Insurance
-Loss of Income Insurance
-Business Property Insurance
-Equine Liability (we’ve got horses, yay!)
-Food Spoilage Insurance

Have I left any insurance coverages off the list? I have no idea what a policy like this would cost. Thanks for you help! I’ve enjoyed this project and it’s been very interesting, but at the same time it’s quite daunting!

OK, see, you’ve got HUGE variables here. How much does it cost to rebuild the barn? The house? How much fence do you have? What’s the construction material? Protection class? How old are your structures? Are they all fully sprinklered? How many horses? What are the gross receipts from the B&B? What are your payrolls for employees, and for how many employees?

Lots more, but it’s very, very detailed – including driving records for the person driving the business auto, what KIND it is, how far they go, what exactly they DO with it.

If I had to pick a number off the top of my head, a range, for insurance for this type of business, it would be anywhere from $6,000 a year (small mom and pop run, no employees, two horses, $500,000 total property coverage, gross receipts under $15,000 a year) to $25,000.

Typically, B&B’s run on a VERY thin pricing margin, and if you add liabiltiy for HORSES thrown in, you’re probably not going to bring in enough in sales to cover your insurance costs.