Member Stories: How Rainbow is Reimagining Restaurant Insurance



How Rainbow is Reimagining Restaurant Insurance

Restaurants are an important part of any local business community. Yet over the last several years, the pandemic shuttered many restaurants and forced owners in the industry to be creative when it comes to service, space, and
spending. All restaurants require insurance, and in an industry that often operates with razor-thin margins a single large claim can quickly become catastrophic. In a sector that is often at the whims of seasonal demand and inflation, finding appropriate insurance coverage that fits in the budget and is tailored to each restaurant’s needs can be difficult. This is where good insurance agents and the right coverage both play a crucial role.

Enter, founded by Bobby Touran, Shalom Yiblet, and Jamie Hankinson.

After years of experience in the insurance industry, Touran recognized that while major carriers offered insurance coverage for larger companies in the hospitality sector, the purchasing experience and coverage breadth for the specific needs of small restaurants were often sub-par. Add to that the fact that most recently many large carriers have been entirely exiting the restaurant class, and this created an opportunity for an innovative MGU to approach the market with a different perspective. The more he dug in, Touran realized that many of these challenges are not unique to restaurants, and to fix this, he decided to focus Rainbow’s efforts on serving niche segments, recognizing the potential of providing flexible and adaptable insurance solutions that cater to small businesses, starting with restaurants. Unlike other underwriting companies, Rainbow’s vision was to develop customer-centric insurance solutions that actually reward those business owners who carefully manage their risk — after all, safer businesses (those with less risk) should pay less for insurance!

Like any successful MGU, the right capacity partner is absolutely necessary. In 2022 Rainbow teamed up with Accelerant and found a partner aligned with their vision and commitment to small business ventures.

What stood out for the Rainbow team was Accelerant’s dedication to three core aspects: supporting small commercial companies, nurturing startups and small businesses, and taking a long-term view with a five-year capacity provision backed by a long-term reinsurance commitment. This alignment of values and support provided Rainbow with the confidence that Accelerant would be an invaluable ally in their journey to offer first-class coverage for restaurants and bars that fell outside the purview of traditional carriers. Moreover, Accelerant helped Rainbow by making introductions to agents and offering valuable insights for claims handling.

Technology and underwriting expertise enable Accelerant to support Rainbow’s uniquely broad appetite in an otherwise difficult class of business.

Now, Rainbow has developed technology to offer the restaurant industry’s first pay-asyou-go , automatically adjusting premium according to the restaurant’s actual sales and saving business owners money every month. This approach also provides a more accurate underwriting assessment of risk and allows Rainbow to adapt premiums based on a business’s seasonality and performance. Beyond the information submitted in the application, Rainbow also analyzes numerous additional data sources about every insured to more accurately classify and price the risk. The partnership with Accelerant has enabled Rainbow the ability to actively serve customers in Arizona, Texas, Michigan and Indiana, and in an additional 22 states launching in the months ahead.