Hotel Umbrella FAQ: Why does Distinguished care about third-party vendor activities?

Distinguished’s Hotel Umbrella Insurance program offers high-limit protection tailored to the unique needs of hotel properties. With coverage extending to over 20% of the nation’s hotel rooms, Distinguished brings unmatched expertise and stability to the table. Hear from an Umbrella Underwriter, Jen DiBerardino, as she delves into a common Hotel Umbrella question: “Why does Distinguished care about third-party vendor activities?” Our expert underwriters are dedicated to guiding you and your clients, ensuring world-class service and coverage every step of the way.


Why does Distinguished care about third-party vendor activities? Let’s dive in. 

Hi there! I’m Jen DiBerardino, an Underwriter at Distinguished, based in Brick, New Jersey. Today, we’re talking about why we closely monitor third-party vendor activities within our Hotel Umbrella Program. Let’s explore why this matters.

Third-party vendor activities raise concerns because they often expose hotels to liability for injuries and damages if adequate risk transfer measures aren’t in place. You don’t want to expose your insured’s loss portfolio to losses from a third-party they have no control over. This happens all the time. This has been a loss leader during the 25 years we’ve been offering hospitality umbrella programs.  

One common misconception is that if a third-party is operating, the hotel will have no liability. However, this isn’t always the case. If the third party lacks insurance, goes out of business, or has insufficient coverage, claimants often target the hotel as the ‘deep pockets’.

Sometimes, the connection between the hotel and third-party activities are clear. For instance, if the activity is promoted in special packages, operated on hotel premises, or recommended by the hotel concierge. Other times, the connection may be less obvious, like advertisements on the website or, brochures in the lobby.

So, what does Distinguished look for when evaluating third-party vendor activities? Firstly, written contracts are crucial, ensuring the hotel is held harmless and indemnified. Additionally, the hotel should collect certificates of insurance showing the sufficient coverage

Often the hotel should be looking for more than one million dollars in limits from these third-party operations. For example, activities like large shuttles or jetski’s require increased coverage to mitigate potential risks adequately.  

To illustrate why these precautions are crucial, consider this scenario: A guest takes surfing lessons from a third-party vendor arranged by the hotel. Unfortunately, the guest suffers a head injury during the lesson, leading to a lawsuit, naming the vendor and the hotel.  If the vendor has only $1M in limits it will be insufficient, and the hotel will be drawn into defending the claim. 

At the end of the day, ensuring the safety and well-being of guests is paramount. By carefully monitoring third-party vendor activities, hotels can mitigate risks and maintain their reputation. We see this all the time and want your clients to be prepared! 

If you have any questions or need assistance, feel free to reach out to our team. We are happy to help answer your questions. 

Thank you for watching! 

About Jen:

Jen DiBerardino, an Underwriter at Distinguished Programs in New Jersey, brings ten years of experience in the insurance industry. With a background in Premium Audit and Underwriting for seven years, Jen understands various lines of business, such as Property, General Liability, Auto, Workers Comp, and more. In the past year alone, she’s reviewed 150 accounts with over 1,000 hotel locations nationwide, highlighting her attention to detail. Jen also juggles her professional life with being a parent to a 2-year-old daughter and expecting a son soon. Outside of work, she enjoys attending concerts and is part of a bowling league.

About Distinguished Programs

Distinguished Programs is a leading national insurance Program Manager providing specialized insurance programs to brokers and agents with specific expertise in Fine Art and Collectibles, Environmental and Construction Professional, Executive Lines, Inland Marine, Real Estate & Builder’s Risk, Community Associations, Hotels, and Restaurants. Property and Liability products are distributed through a national network of agents and brokers. Serving the same core markets and partnering with the most stable and reputable carriers, Distinguished’s high-limit Umbrella programs remain the clear choice in its area of specialty for superior coverage, competitive pricing, and attentive service. Through thoughtful innovation, stemming back to 1995, Distinguished Programs fosters growth and opportunities for its brokers, carriers, and employees.

View a full list of our programs and submit business with Distinguished.

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