The Rooftop Bar: A Cash Cow or an Insurance Liability Nightmare?

All you need to know.

February 15, 2023

If you visit New York or some other major cities, you might encounter a rooftop bar. Many hotels have them. Some buildings have bars downstairs, but you will also find one on the roof if you head up there.


Some people love rooftop bars. If you’ve got some nice weather, they can seem pleasant. You can grab a beer or mixed drink, sit in chairs under the stars, or mingle and socialize while dressed in your best outfit.

Are rooftop bars a smart idea, though? We’ll discuss them in detail right now. As someone considering setting one up, you should mull over a few factors before moving forward.

Business Hazard Insurance

If you rent or own a building, and you feel like setting up a rooftop bar makes sense, you must first consider the legal liability issues. Any business needs insurance. Usually, as a business owner or operator, you need several different kinds.

With rooftop bars, you’ll need business hazard insurance. You might also hear someone in the insurance industry call this commercial property insurance. This insurance covers the equipment your business uses and also the building that your company owns or rents.

The policy coverage might vary a little. It may cover your inventory, tools and equipment, personal property, and so forth.

If someone breaks into the property and steals your liquor from the rooftop bar, this insurance policy can replace it. If there’s a big storm, and your rooftop bar suffers some damage, the policy can kick in and pay for the repairs as well.

Do Rooftop Bars Need Any Additional Insurance Varieties?

If you own or run a rooftop bar, you’ll also need some additional insurance types. You’ll need worker health insurance. You don’t need it under the law, but you’ll encourage employee loyalty with it. Your bartenders and servers will want health insurance and might stay with you if you offer it.

You will need general liability insurance as well. If someone hurts themselves while visiting your rooftop bar, that policy can cover their medical bills.

You should have work stoppage insurance too. Business interruption insurance helps you pay rent on the building and other expenses if you must close down for any reason. Perhaps there’s a fire in a nearby building, and smoke damage demands that you close the bar for a while. Your work stoppage insurance should kick in at that time.

With these insurance policies in place, you should feel better when running your bar. If anything goes wrong, you can use the policies and continue running smoothly.

What Are Some Rooftop Bar Downsides?

We talked about how some people like rooftop bars. If you play some music, set up some low lighting, and serve strong drinks, you might become a neighborhood staple. Maybe you’ll become a hot spot where celebrities congregate and mingle.

You’re high off the ground, though, and gravity might work against you. Any time you have an establishment that’s high off the ground, you risk someone falling. If you add alcohol, it becomes more likely.

We mentioned how you should have insurance that can help you if someone hurts themselves or even dies on your property. However, if someone does fall off the roof and dies or harms themselves, will your reputation survive?

People might not enjoy visiting a location where someone died or sustained a serious injury. Even though your insurance might protect you legally, word of mouth matters with nightspots. An incident like that might severely harm your bar’s popularity.

You might set up topiary bushes or other obstacles that block people from approaching the roof’s edge. You may also have high railings that should keep tipsy people safe.

Some People Fear High Places

You might also have some people who won’t willingly visit a rooftop bar because they fear heights. Even if you have obstacles that block the roof’s edge, some individuals might stay downstairs or not visit your establishment at all. Railings might not do it either. Heights will keep some people away, so you must consider that.

Weather is a Vital Factor

Also, rooftop bars usually only work in nice weather. If you have a big thunderstorm, people won’t go up on the roof. You can always put up some canopies that block the rain, sleet, or hail, but your rooftop bar’s success needs clear skies.

Does a Rooftop Bar Make Sense for You?

Rooftop bars sometimes sound good in theory but don’t work so well in practice. If you own a building, look at the rooftop, and see a potential moneymaker, consider everything we’ve mentioned before moving forward.

You’ll first require all the necessary insurance policies, and you’ll need a setup that encourages fun but also safety. If you have obstacles keeping people toward the roof’s center, that might work. You can also set up lighting that’s low and sets the mood but still lets people see clearly so that they won’t trip or stumble.

You can set up a canopy or another barrier that blocks rain and other bad weather. You should also have some other downstairs options. Maybe you have a downstairs bar as well. That way, you can close the rooftop bar during bad weather but still let people stay and enjoy themselves. You can make the rooftop bar an occasional, weather-dependent attraction.

If you have some games in your bar, maybe keep them off the roof. You can have darts or a pool table downstairs. On the roof, those activities could cause an accident.

If you have the right insurance policies and set up the proper ambiance, you might find success with your rooftop bar. Some New York, Los Angeles, and Chicago bars do well with this setup, and they bring the building owner or operator money every week.

Just remember the practical concerns with rooftop bars and plan the setup carefully. That’s how you make sure they’re a moneymaker for you and not a potential insurance liability.