Insurance Industry Can Help Pizzerias Avoid Losses on Super Bowl Sunday

Americans will consumer 30 million slices of pizza on Sunday, making Super Bowl Sunday one of the busiest day of the year for pizza chains. Papa Johns, the official pizza sponsor for Super Bowl XL, expects to have its single largest sale day ever, selling more than 900,000 pizzas at its 2,800 U.S. restaurants. Pizza Today magazine says a typical pizzeria will experience a 35 percent sales increase on Super Bowl Sunday.

Yet most people may not realize how the insurance industry can help influence pizza delivery from a safety and risk perspective.

Similar to how the insurance industry helped to teach pizza chains that the 30-minute delivery promise was harmful from a safety and liability perspective, insurance agents also can help advise restaurants on how to avoid claims and prevent loss.

The most common claims for pizza delivery businesses, from a frequency standpoint are losses from an auto line of business, said Jim Hawley, executive risk services consultant for Risk Services & Solutions at Novato, Calif.-based Fireman’s Fund Insurance Co.

He said accidents can result from, but are not limited to:

• rear-ending the car ahead because the delivery driver is following too closely, speeding excessively or driving while distracted;

• turning-related accidents while making U-turns, failing to observe other vehicles and conditions, failing to yield and turning left through intersections; and

• backing accidents when not looking behind or to the side of the vehicle when backing up, and rolling back at traffic control devices.

As with any claims and loss prevention program, it is essential for pizza chains to be proactive by first identifying potential loss sources, Hawley said. Second, he recommended owners educate their drivers on how to identify and avoid the losses. Third, he said store managers should be held accountable for their loss results.

“Too many times, store managers feel that corporate should be responsible for claims and loss reduction, when in reality, the front-line store managers will have a more positive effect on their drivers when it comes to safety,” Hawley said.

Over the past five years, Fireman’s Fund has seen an average of 3 claims per day on the day of the Super Bowl, 9.4 percent higher than the average 2.74 claims per day pizza chains see on all other days. Moreover, the severity of claims are a bit higher on Super Bowl Sunday, with the average claim being $14,799 versus $12,409 on other days, the company said.

Technology, in this case, could actually lead to more distracted driving accidents, if pizza delivery drivers are not trained properly.

“Due to the fast-paced nature of the pizza business, the high risk age of the majority of delivery drivers, and the need to communicate with their co-workers, the safety concerns surrounding smart phones are especially for pizza delivery owners to understand,” Hawley explained.

Fireman’s Fund recommends phones be kept off during deliveries. If necessary, drivers can check in with the shop after the delivery, but before they venture out onto the road, the company said. And it goes without saying that drivers should never read, send, talk or access an application while driving — they should instead pull over to the side of the road.

To further reduce accidents and loss, the insurer suggests drivers:

• check to make sure their vehicles are ready and safe (i.e. lights, tires, windows cleaned, etc.);

• ensure pizzas are securely packed to avoid spillage and disruption while driving;

• park at the curb, because backing up increases the chance of accidents;

• never enter a customer’s house;

• never resist a robbery — it’s better to be robbed for pizza money than wind up in the hospital or worse;

• if there are no lights on, call the shop to verify the delivery and address before entering a home;

• practice defensive driving and adhere to the three-second rule.

Pizza owners themselves should ensure that drivers are properly trained, licensed, insured and have checklists to follow. Most pizza operators don’t provide vehicles for their drivers — workers who are hired to deliver pizzas typically use their personal vehicles and are required to have bodily damage liability coverage added to their personal auto policies. Restaurants also should carry at least $1 million in extra liability coverage to cover accidents in vehicles they don’t own, Fireman’s Fund said.

Ultimately, pizza restaurant owners should use every available resource to assist in their safety and loss prevention endeavors, such as their insurance agent, insurance company and other safety-related organizations, Hawley recommended. “The Web is full of tips that can be used to reduce auto-related fleet driver claims,” he said. “Just because a company doesn’t deliver pizza, [it] doesn’t mean they don’t experience the same kind of exposures. Delivery packages, mail or other merchandise has many of the same exposures as delivering pizzas.”