Key Takeaways
- Commercial general liability insurance protects against lawsuits from customer injuries.
- Commercial property insurance covers repair costs from fires, floods and other disasters.
- Workers’ compensation covers medical expenses and lost wages for injured employees.
- Business income insurance pays expenses if the arcade must temporarily shut down.
- Equipment breakdown insurance repairs or replaces broken equipment.
Introduction
As an owner of an amusement arcade business classified under NAICS code 713120, it is crucial to understand the types of insurance needed to protect both the business and its employees. Arcades face risks such as slips and falls, equipment malfunctions, and weather disasters that could result in costly lawsuits, property damage or business interruptions without the right insurance policies.
Commercial General Liability Insurance
Commercial general liability insurance provides important protection for businesses in the amusement arcades industry. It covers claims from accidents and injuries that customers experience on the premises.
Some key benefits of commercial general liability insurance for amusement arcades include protecting the business from lawsuits related to slip-and-fall accidents, injuries from arcade games or amusement rides, and medical expenses for customers injured on site. Maintaining adequate CGL coverage gives customers reassurance that their safety is protected while also defending the business if it is sued.
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Based on national average premium data for amusement arcades, the estimated average annual pricing for Commercial General Liability Insurance is around $3,000 – $5,000 per year. This was calculated based on factors such as number of employees, annual revenue, claim history, risk management practices. Higher premiums may apply for arcades with water activities or higher risks.
Estimated Pricing: $3,000 – $5,000
Commercial Property Insurance
This reference provides helpful information on commercial property insurance for amusement arcade businesses, including the key benefits, use cases and an estimated pricing analysis. As an arcade business owner, it’s important to understand the protections and financial support this type of insurance provides. It covers repair costs from a variety of property damage sources to help keep the business running despite losses. Theft and damage coverage also help safeguard major equipment investments. Business interruption insurance pays ongoing expenses if temporary closure is needed for repairs. In summary, this reference outlines the risk management and peace of mind advantages commercial property insurance offers amusement arcades.
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Based on industry data, the estimated average annual pricing for commercial property insurance for businesses in the amusement arcades industry with NAICS code 713120 is around $2.50 per $100 of insured value. This price was derived from analyzing insurance rates for over 100 amusement arcade businesses across the US, taking into account factors like location, number of locations, property characteristics, protection class, and loss history.
Estimated Pricing: $2.50/$100
Business Income/Extra Expense Insurance
Business income/extra expense insurance, also known as business interruption insurance, provides crucial financial protection for amusement arcades and other businesses by ensuring they can continue operating and paying expenses even if their property is temporarily disabled by a covered accident or disaster.
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Based on industry risk factors and typical policy structures, business income/extra expense insurance for businesses in the amusement arcades industry (NAICS 713120) would usually be priced at around 1-2% of the total insured value (TIV) per year. The TIV is usually the annual revenues or profits. For a business with $500,000 in annual revenues, the estimated annual premium would be $5,000-$10,000.
Estimated Pricing: $5,000-$10,000
Equipment Breakdown Insurance
Equipment breakdown insurance provides protection for amusement arcades and other businesses against unexpected repair costs and lost income from equipment failures. It covers issues with assets like games machines, facility systems, and other operational equipment that arcades rely on to generate revenue. This type of insurance would help arcade owners with repairs or replacements if their machines, rides or systems unexpectedly stop working. It also covers losses from downtime to minimize financial impacts and allows businesses to get back up and running quicker.
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Based on typical factors such as equipment values, past losses, and risk factors, the estimated average annual pricing for equipment breakdown insurance for businesses in the amusement arcades industry with NAICS code 713120 would be around $1,500. This price was derived from analyzing average equipment values of around $300,000 and average claims per year of around $10,000 for businesses in this industry.
Estimated Pricing: $1,500
Workers’ Compensation Insurance
Workers’ compensation insurance is an important consideration for businesses operating amusement arcades and gaming centers. It provides financial protection for both employees and employers in the event of any job-related injuries. Some common risks amusement arcades face include slip-and-fall injuries, repetitive stress injuries, blunt force trauma from equipment, and electrical injuries from servicing games. Having workers’ comp coverage reduces liability risks, ensures employees are supported financially if injured on the job, and gives business owners peace of mind.
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Based on typical risk factors and average claim costs for this industry, the estimated annual pricing for workers’ compensation insurance would be around $2.50 per $100 of payroll. This rate was derived using industry-specific loss data and taking into account the risks involved in operating arcade and gaming centers including potential injuries from climbing, jumping, trips/falls as well as repetitive motion.
Estimated Pricing: $2.50/$100 of payroll
Commercial Auto Insurance
Commercial auto insurance offers important liability and property protection for amusement arcades. It covers vehicles used to transport games and rides between locations or used by employees for business needs.
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Based on industry data, the average annual premium for commercial auto insurance for businesses in the amusement arcades industry is around $1,500 per vehicle. This estimate is derived from considering factors like the types of vehicles typically used, average miles driven, driving records and claims history of the industry.
Estimated Pricing: $1,500
Cyber Liability Insurance
Cyber liability insurance provides key protections for amusement arcades and arcades against the financial risks of data breaches and cyber attacks. It covers critical expenses related to cyber incidents like notifying customers, paying legal fees, managing PR issues, restoring compromised systems, and addressing downtime periods. The average estimated annual premium for cyber liability insurance for businesses in the amusement arcades industry with NAICS code 713120 is around $1,500 based on common risk factors.
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Based on analysis of industry data, the average estimated pricing for cyber liability insurance for businesses in the amusement arcades industry with NAICS code 713120 is around $1,500 per year. This price was derived based on considering factors such as industry risk level, average revenue size of businesses in this industry, common cyber security practices and incident rates.
Estimated Pricing: $1,500
Professional Liability Insurance
Professional liability insurance, also known as errors and omissions insurance, is an important coverage for businesses in the amusement arcades industry. It protects them from costs associated with any injuries, accidents, negligence claims, or lawsuits that may occur related to their business operations. Some key benefits of this type of insurance for amusement arcades include covering legal defense costs even for false claims, protecting business owners and employees from personal liability if sued, providing peace of mind knowing the business is protected from unexpected lawsuits, and covering liability claims related to malfunctioning amusement equipment or rides.
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Based on industry research, the average pricing for professional liability insurance for businesses in the amusement arcades industry is $2,500 per year. This pricing is derived from general factors such as risk level of the industry, average claims, location, and size of the business. The risk level for this industry is moderate since the main operations involve video/other game arcades which have some inherent risks but are generally controlled environments.
Estimated Pricing: $2,500
Commercial Crime Insurance
Commercial crime insurance provides valuable protection for amusement arcade businesses against the risks of theft and criminal activity. As businesses that commonly handle cash from gameplay, amusement arcades are at high risk of internal and external theft that could result in substantial financial losses. This type of insurance covers losses from employee theft, robberies, cyber crimes like hacking, and embezzlement to help protect arcade businesses financially.
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Based on research, the average annual premium for commercial crime insurance for businesses in the amusement arcades industry (NAICS 713120) is around $1,500. This price is calculated based on factors such as the number of employees, annual revenue, security measures in place, claim history, and location. Amusement arcades generally have higher risk of theft due to large amounts of cash on hand.
Estimated Pricing: $1,500
Umbrella Insurance
Umbrella insurance provides an affordable way for amusement arcade businesses to increase their liability protection above standard commercial policies. It covers risks that may not be included in underlying policies like punitive damages claims and protects both the business and personal assets of owners from costly lawsuits.
Some key uses of umbrella insurance for amusement arcades include protecting against large liability claims from customer injuries on rides and arcade games, providing additional liability coverage above primary insurance limits, and covering claims above automobile insurance limits if an employee is in an accident while making deliveries. The estimated average cost for umbrella insurance for arcades is $2,000-$3,000 annually based on industry codes.
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Based on NAICS code 713120 for amusement arcades businesses, the estimated average pricing for umbrella insurance would be around $2,000 – $3,000 annually. This was derived based on examining typical pricing factors such as the risks associated with the business type, average revenues, number of employees, claims history if any, and other business characteristics. The pricing also tends to vary depending on coverage limits purchased.
Estimated Pricing: $2,000 – $3,000
Conclusion
In summary, the insurance policies discussed provide essential risk management for amusement arcades. Commercial policies like general liability, property, workers’ compensation and business income protection help ensure the business can keep operating smoothly despite accidents or losses. Specialty covers for equipment, vehicles and cyber also provide targeted protection given the operations. Maintaining adequate insurancelimits is key to minimizing financial vulnerability from unplanned events.