Christie Insurance highlights rising premiums in Hospitality Market Review 2025

The UK insurance market for pubs and hospitality businesses remains challenging in 2025. Premiums are rising, and insurer appetite is limited, particularly for venues outside the family-friendly or gastro-pub categories. Elevated rebuild costs and an increase in claims are contributing to a tough environment for business owners.

Why Are Premiums Increasing?

Premium hikes are largely driven by insurer caution. Many insurers remain reluctant to cover risks involving liquor liability or entertainment-related exposures. This reduced capacity means insurers are becoming more selective, especially with businesses that have extended opening hours or a history of claims.

Key underwriting concerns include alcohol service, crowd control, and on-site security. As a result, some businesses are being directed toward specialist insurance providers, which may not offer the same financial stability as mainstream insurers.

Rebuild Costs Continue to Rise

Although general inflation is around 3.5%, rebuild costs for hospitality properties remain significantly higher. This is due to:

• Increased labour costs following changes to National Minimum Wage and National Insurance contributions
• Rising material and transport costs impacting repair and reinstatement expenses

Christie Insurance encourages pub and restaurant owners to regularly review their building insurance to ensure it reflects current rebuild values. While this may increase premiums, it helps avoid underinsurance — a risk that could lead to serious financial shortfalls in the event of a claim.

Claims Trends in Hospitality

Public liability remains a major concern, particularly in high-traffic areas such as bar floors, restrooms, and outdoor seating zones. Environmental risks are also becoming more prominent. Surface water flooding, driven by heavier rainfall and aging drainage infrastructure, is increasingly affecting hospitality venues, especially in urban settings.

Insurers are responding by refining flood risk models and adjusting pricing strategies accordingly.

Cyber Cover: A Growing Priority

Cyber threats are escalating across the hospitality sector. With more pubs and restaurants using digital booking platforms, point-of-sale systems, and storing customer data, they are becoming prime targets for cybercriminals.

Cyber insurance premiums remain competitive in 2025, making cover more accessible. However, many businesses still seek protection only after experiencing an incident. Christie Insurance urges clients to adopt a proactive mindset — shifting from “if” to “when” a cyber-attack may occur.

To discuss insurance for your business, get in touch:

David Foster
Account Executive – New Business
Christie Insurance
E: David.Foster@christieinsurance.com
M: +44 7561 114 969