Every year, millions of visitors flock to Hawaiʻi’s world-famous gatherings, from Honolulu’s Pan-Pacific Festival to the Merrie Monarch Festival in Hilo. Hawaiʻi’s vibrant small business community thrives in these peak tourist seasons. However, the influx of millions of extra visitors brings new liability risks, and the tourist numbers are growing every year. In December 2024 alone, Hawaiʻi received over 910,000 tourists, an increase of 5.5% compared to 2023.
Business owners must recognize and account for the risks that the festival season can bring. Larger crowds mean more foot traffic, more risk of theft and vandalism, and greater chances for accidents.
This article outlines essential information about Hawaiʻi business insurance to help prepare for Hawaiʻi’s yearly festivals and gatherings.
Conduct a Risk Assessment
While every business in Hawaiʻi shares certain risks, those in tourist-centered industries or areas should devote more resources to crowd control, worker safety, and other factors. This includes conducting impact assessments of certain festivals or gatherings to determine the predicted cost to their assets. These assessments include:
- Evaluating physical spaces for crowd control measures, including flow, exit locations, and emergency services
- Securing valuable, hazardous, or delicate items to make sure they cannot be damaged or stolen during peak times, including outdoor signage
- Training staff on how to respond to large crowds, including emergency response procedures and amended customer service protocols for high-traffic areas
- Coordinating with local authorities and festival organizers to clarify street closures, emergency procedures, and parking restrictions near the business
Festival risk management may also include preparations specific to the business. Business owners in Hawaiʻi should speak with an insurance planner to review these assessments and customize their plans.
Update Insurance Coverage
Insurance coverage offers essential protection during festivals and other high-traffic seasons by covering businesses in case of crowd-related injuries, third-party liabilities, property damage, and more. Before a major gathering, business owners should review their insurance coverage and update it to address coverage gaps or changes in their operations since their last review.
For example, general liability policies should be updated to include special coverage for crowd-related incidents, physical injuries, and potential lawsuits resulting from on-site accidents during high-traffic events. Event-specific endorsements can be added to policies, which is significant for businesses that actively participate in festivals, such as through business sponsorships of specific events.
Additionally, business interruption insurance protects businesses against unforeseen closures. In the event of a public safety issue resulting from a festival or other event, these policies can cover lost income and other negative effects of the closure.
Evaluate Permits and Licenses
Many businesses change their operations to accommodate festivals. These changes may require additional licenses or permits, which business owners should check to prevent legal or safety liabilities. For example, many businesses sell food or merchandise outdoors to passersby, which requires a temporary vending permit. Businesses that offer outdoor entertainment may need a noise permit.
This documentation safeguards businesses against potential legal action from third parties, including other businesses. Without consulting the proper authorities, such as local county permit offices or the Hawaiʻi Department of Health, businesses can face fines or even forced closures as a result of non-compliance.
Communicate with Employees and Customers
Crowd surges can cause changes to on-site business activities. Both employees and customers should know about them beforehand to better prepare. For example, many businesses alter their operating hours or offer festival-related promotions. These can be communicated to customers on the website or social media accounts of the business. Employees can be notified via email or in person to prepare them for their customers’ new expectations.
Even the access route of a business can change due to road closures or detours related to festival activities. Businesses must communicate with their customers to maintain operations and retain consumer trust even during high-traffic events. On-site signage can help redirect visitors if entrances and exits are unclear.
Stay Protected During Festivals and Gatherings with Hawaiʻi Business Insurance
Festivals and other events in Hawaiʻi provide businesses with opportunities to increase their customer reach and profit margins for the season. However, high-traffic events come with risks that businesses must prepare for to avoid liabilities, including property damage, theft, unexpected closures, and on-site accidents. The proper precautions include updated business insurance policies, safety strategies, and clear communication with customers and employees.
Many businesses struggle to optimize these processes without expert help, which is why the team at Atlas Insurance provides expert business insurance guidance for local companies. For over 95 years, our team has helped Hawaiʻi’s businesses to customize their insurance policies for their specific needs, including seasonal risks.
Contact our agents today to be prepared for the specific changes of Hawaiʻi’s dynamic seasonal business environment with insurance policies tailored to the exact needs of your business.