The UK insurance market is in a period of significant change. According to the London Market Group’s 2026 London Matters report, the London market now generates $187 billion in gross written premium, having doubled in size over the past decade, and contributes £61 billion to UK GDP. It’s a picture of remarkable growth. And yet, underneath those headline figures lies a serious structural challenge: the market is ageing rapidly, with the share of workers under 30 projected to fall from 24% today to just 7% within a decade.
For pub and restaurant owners, this matters more than it might first appear. As experienced specialist underwriters retire and the pipeline of new talent struggles to keep pace with demand – graduate insurance job postings fell 18% year-on-year in September 2025, according to the LMG – the pressure is growing on every corner of the market. And in hospitality, where risks are highly specific and underinsurance remains a persistent problem, that specialist knowledge gap could prove costly.
Here’s what the hospitality and leisure sector needs to understand about insurance in 2026 – and why working with a specialist broker has never been more important.
A Sector Under Pressure – and Underinsured
The UK hospitality sector has endured an extraordinarily difficult few years. Rising employer National Insurance contributions, energy bills that remain around 70% higher than pre-pandemic levels despite easing from their 2022 peak, steep food and drink input cost inflation of more than 30% between 2021 and 2024, and ongoing staffing challenges have created a perfect storm for operators. For pubs specifically, a new business rates revaluation in April 2026 has added further strain, with some venues seeing rateable value uplifts of more than 70%, according to analysis by global tax firm Ryan.
The government has confirmed a 15% business rates discount for qualifying pubs in 2026-27 – a measure welcomed by the sector, though restaurants and hotels were notably excluded from the relief, according to Simply Business. This financial squeeze matters directly for insurance. When margins are tight, the temptation is to cut costs wherever possible. Insurance is often in the firing line – and that’s where the risk of underinsurance creeps in.
As reported by Insurance Business UK, well-managed hospitality businesses with strong financials continue to attract competitive cover. But those with inadequate risk management or financial vulnerability may struggle to secure appropriate terms – or find themselves exposed when a claim arises.
New and Emerging Risks You Might Not Have Planned For
The risk landscape for pubs and restaurants in 2026 looks quite different from even five years ago. Beyond the traditional concerns of fire, flood, and liability claims, operators now need to think carefully about a wider range of exposures.
Cyber liability is one of the fastest-growing risk areas. The shift to digital ordering systems, contactless payments, online booking platforms, and loyalty apps means hospitality businesses now hold significantly more customer data than ever before. A breach or ransomware attack can shut a venue down entirely, and standard commercial insurance policies often don’t cover this. Dedicated cyber insurance for hospitality businesses is becoming an essential consideration, not an optional extra.
Allergen and food safety liability continues to grow in complexity. Legislation around allergen labelling and management has become more stringent, and insurers now expect robust compliance as standard. Failure to demonstrate proper allergen controls (from labelling to staff training) can not only result in a denied claim but also expose operators to regulatory penalties and reputational damage. Product liability cover is an essential part of any pub or restaurant insurance policy.
Business interruption gaps remain a significant issue. The Covid pandemic exposed how many hospitality businesses had business interruption cover that didn’t adequately protect against forced closure. With the deadline for Covid BI claims approaching March 2026 under the Limitation Act, according to The Morning Advertiser, many operators who held policies in 2020 may not yet have reviewed their position. More broadly, understanding exactly what events trigger a BI payout is critical when reviewing any policy renewal in 2026.
Employers’ liability complexity has also increased. Changes to employment law, higher minimum wage obligations, and the growth of zero-hours and seasonal contracts all have implications for how employers’ liability needs to be structured. If your staffing model has changed since you last reviewed your policy, it’s worth a conversation with a specialist.
Why Specialist Broking Matters More in a Changing Market
The talent pressures facing the broader insurance market make it more important than ever to work with brokers who already have deep, established expertise in hospitality and leisure. As the LMG has warned, experienced specialist knowledge takes years to develop, and as senior underwriters retire and hiring pipelines thin, that expertise becomes a scarcer commodity.
For pub and restaurant owners, a specialist broker isn’t just there to find the cheapest premium. They’re there to ensure your sum insured accurately reflects current rebuild and replacement costs (which have risen sharply), that your policy wording actually covers the events most likely to affect your business, and that you’re not carrying gaps in cover that only become apparent at claim stage.
At Bateman Group, our hospitality and leisure insurance offering covers pub and restaurant insurance, hotel and guesthouse insurance, and event insurance, designed with the specific demands of the sector in mind. Whether you’re a sole trader running a village local or a multi-site restaurant group, we work to present your business to the market in the most accurate and favourable way, ensuring your cover reflects what you actually do, and what you actually need.
Talk to the Bateman Group team about your hospitality insurance needs. Whether you run a pub, restaurant, hotel or guesthouse, or you’re planning an event, we’ll make sure your cover is built around your business — not just a standard policy template.
