Bali’s Accommodation Business is Booming — Risks Are Increasing
Over the past two decades, Bali has transformed from a tourist destination into a global hospitality hub. Thousands of private villas, boutique hotels, and homestays have sprung up in areas like Canggu, Seminyak, Uluwatu, Ubud, and Sanur.
Data from the Tourism Office shows that in recent years, there has been a 20% annual increase in accommodation business permits. Many local and expatriate investors are attracted by the potential for high returns and the strong international market.
But behind this growth, there is one thing that is often overlooked: protection against financial risk.
Bali is located in a disaster-prone area — earthquakes, floods, fires, and even legal risks for guests or employees.
A single incident can destroy a business owner’s reputation and finances.
This is where the role of an authorized insurance broker like L&G Insurance Broker becomes crucial — helping you identify risks, choose the right policy, and ensure that assets worth billions of rupiah are optimally protected.
The Real Risks Faced by Villa, Hotel, and Homestay Owners in Bali
Many entrepreneurs consider insurance an “extra expense.” In fact, the opposite is true—insurance is a capital protection strategy.
The following are the most common risks in Bali:
| Types of Risk | Case Studies in the Field | Financial Impact |
| Fire | An electrical short circuit in the villa’s kitchen caused a total fire. | Rp2–5 billion in asset losses. |
| Floods & Earthquakes | Floods in the Kerobokan area damaged 10 hotel rooms. | Rp. 500 million renovation costs. |
| Theft | Electronic equipment and furniture were missing when guests checked out. | Rp100 million asset loss. |
| Legal Responsibility (Liability) | Guests slipped in the swimming pool and demanded compensation. | Rp. 300 million legal claim. |
| Business Interruption | The villa was closed for 3 months due to post-flood renovations. | Loss of income of Rp. 600 million. |
All of the above risks can be transferred to an insurance company — with professional guidance from L&G Insurance Brokers who understand the conditions of the accommodation business in Bali.
The Important Role of Insurance Brokers like L&G
Many villa and hotel owners purchase policies directly from agents without understanding the detailed terms and exclusions. When a claim is filed, the question arises: “Why isn’t it covered?”
The main differences between insurance agents and brokers (such as L&G) are:
| Insurance Agent | Insurance Broker (L&G) |
| Representing insurance companies. | Representing the interests of the client (insured). |
| Limited to certain products. | Can choose products from various companies. |
| Focus on selling. | Focus on protecting and accompanying claims. |
| Not analyzing business risks. | Conduct a thorough risk analysis. |
L&G Insurance Broker, licensed by the OJK and a member of APPARINDO, has been serving corporate clients, hotels, villas, and hospitality businesses throughout Indonesia for more than 30 years.
L&G doesn’t just sell policies — it analyzes building structures, locations, electrical systems, and even the potential for natural disasters before recommending the best insurance products.
Recommended Types of Property Insurance in Bali
- Property All Risk (PAR)
The most comprehensive type of insurance to protect business buildings, furniture, and equipment from almost all physical risks — such as fire, flood, earthquake, explosion, and theft.
Sample case:
A villa in Seminyak partially burned down due to an air conditioning short circuit. With a Rp 6 billion Property All Risk policy arranged by L&G, the owner received Rp 850 million in compensation for renovations and repairs.replacementfurniture.
Estimated premium: 0.1% – 0.35% of asset value per year.
- Earthquake & Natural Disaster Insurance
Bali is located in an earthquake-prone zone. Earthquake insurance covers building damage caused by ground shaking, tsunamis, or volcanic eruptions.
Example:
The 2018 Lombok earthquake caused severe damage to hundreds of villas in North Bali. Owners who had earthquake insurance through a broker received full compensation for structural damage.
- Flood Insurance
Areas like Kerobokan, Denpasar, and Gianyar frequently experience seasonal flooding. Water entering villas can damage furniture, electronics, and building structures.
Estimated additional premium: 0.05% – 0.15% of the property value per year.
- Machinery Breakdown & Electrical Short Circuit
For hotels and villas that have large cooling systems, generators, and laundries, it is important to add protection for machine damage or electrical short circuits.
Sample case:
A hotel laundry in Sanur was damaged by a PLN power surge. L&G’s Machinery Breakdown policy covered the Rp250 million loss in full.
- Public Liability Insurance (Legal Responsibility)
Protects business owners if guests, vendors, or third parties suffer injury or loss on the property.
Sample case:
A guest slipped in the hotel pool and broke her leg. Public Liability Insurance worth Rp 5 billion covered legal costs and medical compensation.
Estimated premium: 0.1% – 0.3% of the desired liability limit.
- Business Interruption Insurance
If a villa or hotel is unable to operate due to a disaster (e.g. fire or earthquake), this policy replaces lost income during the repair period.
Example:
A hotel in Ubud had to close for two months after the flood. L&G’s Business Interruption Policy covered Rp1.2 billion in lost revenue.
L&G Insurance Broker Joint Insurance Process
L&G runs a professional and transparent process:
- Property Risk Analysis
The L&G team visited the site, assessing the building structure, electrical system, security system and potential disasters.
- Recommended Insurance Products & Companies
L&G compares trusted companies like Allianz, Zurich, MSIG, Chubb, and Sompo to find the best options.
- Premium & Benefit Negotiation
Brokers negotiate the lowest premiums with maximum benefits.
- Police & Documentation Completion
All documents are prepared to international standards, both for Indonesian citizens and expatriates.
- Claims Assistance
In the event of a loss, the L&G team will handle the claims process until the disbursement is complete.
Benefits of Choosing L&G Insurance Broker
- Official & Experienced — Licensed by OJK and member of APPARINDO.
- Independent Advisor — L&G does not represent any insurance company, but stands on your behalf.
- Property & Hospitality Specialist — Focus on protecting villas, hotels, and commercial businesses.
- 24/7 Claims Support — Our local team in Bali is ready to help at any time.
- National & International Reputation — Trusted by foreign investors and local business players throughout Indonesia.
Property Insurance Premium Estimates in Bali
| Type of Protection | Premium Estimate | Notes |
| Property All Risk | 0.1% – 0.25% of asset value | Most recommended |
| Earthquake Cover | +0,05% – 0,2% | Mandatory in hazardous areas |
| Flood Cover | +0,05% – 0,15% | Optional according to location |
| Public Liability | 0.1% – 0.3% of the limit | For third party claims |
| Business Interruption | 0.1% – 0.2% of turnover | Recommended for large hotels |
Example: A villa worth IDR 10 billion in Canggu will have a total annual premium of around IDR 12–25 million depending on the type of coverage.
Real Case Study – L&G Client in Bali
Case 1 – Premium Villa in Seminyak
A villa was severely damaged by a fire caused by a short circuit. L&G assisted with the claim process with the insurance company, and the client received Rp3.8 billion in compensation within 21 business days.
Case 2 – Boutique Hotel in Ubud
The flood caused damage to furniture and lost two months of revenue. With the Property + Business Interruption Insurance package, the hotel was able to continue paying staff salaries and complete renovations without incurring debt.
Conclusion: Protect Your Property Investment in Bali
Investing in the villa and hotel sector in Bali promises high returns, but also carries significant risks.
Without proper insurance, a single event such as a fire, earthquake, or legal claim could wipe out years of profits.
With the support of L&G Insurance Broker, you get a partner who understands the Bali tourism industry and has an extensive network of national and international insurance companies.
“Protect your property, protect your peace of mind — with L&G Insurance Broker.”
Contact L&G today for a free consultation and risk analysis of your property.
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DON’T WASTE YOUR TIME AND SECURE YOUR FINANCES AND BUSINESS WITH THE RIGHT INSURANCE.
HOTLINE L&G 24 JAM: 0811-8507-773 (PHONE – WHATSAPP – SMS)
Website: lngrisk.co.id
Email: halo@lngrisk.co.id
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