If you own a food business of any kind or are considering purchasing a food truck, food trailer, food cart or a food van it is essential for you to understand what is food business insurance and why it is needed.
Without the right food vendor insurance, you leave your business extremely vulnerable and may be forced to close your food truck due to an unforeseen disaster or event. In this guide, we outline and explain everything you need to know about food trailer insurance to ensure you can find the right food truck insurance for your business.
You can also easily compare cheap food truck & business insurance quotes online from the best food truck and business insurance companies for free through this page and it is also highly advisable.
Today's society is extremely litigious and. For this reason, as food business and food trucks are mostly small business that require small business insurance, food insurance for small business ventures is particularly important as it prevents small food truck businesses from going under due to something as small as a broken contract, a disgruntled employee, or a malicious customer looking to take advantage of an accident. Even if a food truck wins a legal claim against them, the legal fees alone are likely to be devastating financially. Rather than worrying about every mistake and obsessing over potential future disasters, food business insurance and food truck insurance can safeguard your business and protect it from legal accusations. Even if you only operate your food business part-time, or even once a year as food vendor in festivals, it is recommended you secure a one day food vendor insurance cover, for a complete peace of mind.
Though it can vary from state to state, it is often a legal requirement for a business to provide certain types of insurance, e.g. workers' compensation and unemployment. If you have the incorrect insurance for the state you work in, you may receive a hefty fine or a criminal penalty. Legal fines are often much more frustrating and expensive to handle compared to a food trailer insurance policy, for example.
It seems, unfortunately, that natural disasters are becoming increasingly common. From storms to wildfires, there is a number of natural events that can bring your food business to a standstill. If such an event should occur, your food business insurance or food truck insurance cover will carry any damage or loss of property and reimburse you for any loss of income. This ensures not only that you are not hit with any unexpected costs to replace and repair your food truck equipment, but also that your food business does not experience any cash flow problems.
For small food businesses, such as food trucks or food trailers, the most valuable asset is usually the employees. Whether an employee accidentally injures themselves or injures a customer, it's essential an employee feels like they have the back and support of their company in order to feel like a valued member of the team. To create a positive working environment you may wish to offer your food business staff, or team, insurance coverage beyond the legal minimum requirement, such as disability coverage, to invest in and maintain employee morale and keep it high. You can always charge your employees a portion of the additional coverage if necessary. Taking care of your employees will help to prevent frivolous lawsuits against disgruntled employees looking to take your food business down, or themselves up.
Today's consumers are becoming increasingly conscious about where they spend their money and their nutrition habits.
Before eating at a food business a potential customer will most likely have Googled you, visited your social media pages, checked your food hygiene rating, and looked at your reviews online.
If a consumer notices you have failed to state your food truck business is insured, this might raise a significant red flag and cause a customer to perceive your business as unreliable and untrustworthy.
Having thorough food business insurance cover, on the other hand, proves to customers that you are reliable and serious about your food business, whether it's food truck insurance, food van insurance, food cart insurance or a food trailer insurance, it is essential.
As a food business, naturally you'll want to build and maintain relationships with the best suppliers and form lasting partnerships with other businesses within your industry. Business insurance is often stated as a requirement in contracts you may be given from both customers and your partners.
For example, a client may request that you have business insurance when catering for their wedding to ensure you are both covered in the event unexpected things that were not in the plan happen.
Similarly, a landlord may request you have food business insurance when renting your storage space for your produce and truck, as their own policy may not cover it.
Commercial auto insurance is essential coverage for a food business, whether it's a food truck, trailer, van or cart. Commercial auto liability cover will not only protect your physical vehicle, but it will also protect the permanently attached equipment and appliances inside the vehicle, which are often as equally expensive and vital to a food truck, van and trailer as the vehicle itself.
The commercial auto liability insurance cover you select must meet the minimum requirements of your state. Food truck businesses are often encouraged to look for policies that exceed their state requirements, however, as food trucks are often more valuable than standard commercial vehicles, such as taxis.
For example, some states require commercial vehicles to have a liability coverage of at least $500,000, though this is unlikely to cover the cost of damage and legal fees if your food truck business is in a serious accident or is severely damaged. A food truck business generally carries more oil, gasoline, and flammables than a standard commercial vehicle, making a thorough commercial auto insurance policy essential.
Commercial auto liability insurance mostly covers:
• Property damage liability, including damage to another vehicle
• Bodily injury liability, for example, if a pedestrian is accidentally injured by your truck
• Personal injury liability, if your truck driver or passenger is injured whilst driving
• Collision insurance coverage, to protect your vehicle in the event of a crash
• Uninsured motorist coverage, to ensure your food truck is protected in a collision with an uninsured or underinsured driver
General, product or public liability insurance for food business are different from commercial auto liability insurance coverage.
For example, if you accidentally drop a utensil from your van whilst cooking, and it injures a pedestrian or a parked car, this will be covered by a food truck liability insurance, or a liability insurance for food business/vendors coverage.
If you crash into a vehicle whilst driving, that would be covered under your commercial auto insurance.
General liability insurance for food business is essential for street food businesses as it can cover a wide range of occurrences, such as compensation claims made by a pedestrian, who walked by your business, for injury or damage.
For example, if you accidentally spill hot food on a pedestrian or a customer, or if a customer had food poisoning after eating at your place, product liability insurance for food business will protect your business against any legal actions or compensation claims by that customer towards your business.
Accidents, unfortunately, happen all the time, often when businesses least expect them. The majority of food businesses, whether they are food trucks, vans, trailers or carts, will require roughly $2 million total coverage for general liability.
This will ensure that should an accident happen or you are hit with a surprising lawsuit or claim, it will not destroy and bankrupt the food business you invested so much love, time, money and effort in.
Think about how much time, money, efforts, love and energy you invested in your food business, be it a truck, cart, van or trailer - and even as a food vendor. Then consider the cost of all your equipment and produce. Naturally, you'll want to keep your investment safe and protected. Commercial property insurance coverage can help you achieve this.
Commercial auto insurance for food business will only cover the truck itself, and potentially any permanent equipment installations it has.
Food business property insurance will provide in-depth property coverage and offer protection against equipment breaking, modifications to equipment, theft, and loss of business income due to any of the previously mentioned causes and reasons.
In almost every state in America, workers' compensation insurance is required, in order to take care of employees. Workers compensation insurance coverage for food business ensures employees who are injured whilst at work, preparing and serving food or doing any other work related to your food business, have compensation for lost wages and medical bills.
This type of coverage usually includes employer's liability insurance, which protects the food business owner against lawsuits that are related to injuries sustained in the workplace, but this can vary.
Many new and start-up food trailers hire family and friends on a casual basis in an attempt to cut costs and are then hit with legal fines and medical bills when accidents occur and find out that it was actually costing them more. It is essential, therefore, that your food business have workers' compensation coverage in place to protect both your business and its employees.
It should be noted, a food business employee can only receive compensation for their injury or illness if it is directly related to the duty of their job on the food business.
This, for example, could include a back injury caused by lifting heavy stock or slipping on the floor due to an oil spill. Incidents such as an employee injuring themselves on their commute to work due to intoxication, are not covered by workers' compensation insurance for food business.
Some metropolitan areas and venues that welcome food truck businesses will require or recommend further cover to general liability insurance for food business, commercial auto liability, and workers' compensation.
They may recommend $3 million coverage, for example. A commercial liability umbrella insurance coverage can be used to bump up food business insurance policies. A liability umbrella can be ideal if you are taking your food truck or business to a new location.
For example, it can be very useful as an added coverage to food vendor insurance for festivals or liability insurance for farmers market events, to provide additional coverage to these existing food business insurance policies.
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Food business insurance cost is $27 and $175 per month on average.
Food businesses should, therefore, expect to pay between $324 and $2,080 per year.
This could increase to around $10,000 for larger food vendor businesses.
Here is a quick breakdown of average food business insurance cost estimates:
|Coverage Type||Cost Per Month||Cost Per Year||Coverage Amount|
|General Liability Insurance||$42-$84||$500-$1,000||$1 million|
|Business Owner's Policy (BOP)||$42-$126||$500-$1,500||$1 million|
|Commercial Auto Insurance||$75-$100||$900-$1,200||$1 million|
|Equipment Breakdown Insurance||$25-$67||$300-$800||$50,000|
|Workers' Compensation Insurance||$58-$208||$700-$2,500||$1 million|
|Commercial Property Insurance||$62||$750||$1 million|
|Commercial Liability Umbrella Insurance||$79||$950||$1 million|
|Type||Cost Per Month||Cost Per Year|
|Food truck / Ice cream truck||$37-$83||$450-$1,000||$1 million general liability coverage|
|Food cart / Hot dog cart||$19||$229|
|Food trailer / Food concession trailer||$37||$449||$2 million general liability coverage|
|Food van / Mobile catering||$80||$950|
|Food vendor / Mobile food vendor||$25||$299||One-day food vendor insurance cost starts at $50 per day|
Food business insurance provides coverage for wide variety of food businesses. This include, but not limited to:
Be sure to find the right food business insurance for your particular food business.
If you own an ice cream truck, you can expect an ice cream truck insurance cost between $37 and $83 per month $450 - $1,000 per year for general liability coverage.
Such ice cream truck insurance provides around $1 million in general liability coverage.
Hot dog cart insurance cost start at around $229 per year, or $19 per month.
Hot dog cart insurance is usually cheaper than ice cream truck insurance, as although the businesses operate in a similar way, a hot dog cart is not considered an actual vehicle and, therefore, carries less liability.
Food concession trailer insurance cost with total general liability insurance coverage of $2 million starts at $37 per month or $449 per year.
General liability insurance coverage of $1 million is recommended as the minimum for food concession trailers.
If you own a mobile catering business, you should be prepared for a mobile catering insurance cost of $80 per month for commercial auto insurance, or roughly $950 annually.
This is slightly cheaper than some of the aforementioned food vending businesses as a mobile catering van is primarily used for storage and transport rather than cooking, preparing and serving food.
If, however, you are a food vendor who works throughout the year and does not have a fixed permanent residence, you can take advantage of commercial food liability insurance policies which start at around $25 per month or $299 per year.
Many event organisers will require food vendors to provide food vendor insurance coverage before approving their application to cater to festivals, events and farmers markets.
As previously mentioned, it is essential for food vendors who only operate at one or two events per year to still purchase adequate food business insurance. This is what one dat food vendor insurance was made for.
For example, insurance companies such as Nationwide allows one-day food vendor insurance policyholders to tailor their coverage with short-term policies for use away from their official premises.
This is usually at a small additional cost to their existing food business insurance.
One-day food vendor insurance cost starts at around $50 for one-day events.
The mobile food industry is thriving. From taco trucks to ice cream, shave ice and hot dog carts, to sea food vans and burger trailers, it seems an outdoor festival or wedding reception is no longer complete without a mobile food truck, cart or trailer. As the industry is constantly developing, however, it can be difficult for some food business owners to understand whether or not their business requires food service insurance.
In short, everything we mentioned so far should have help you understand by now that food business insurance is essential.
However, some food businesses that commonly need mobile food truck insurance can be:
• Lunch trucks
• Food trucks
• Catering trucks/vans
• Food concession trucks
• Ice cream vans/trucks
• Food concession trucks
• Hot dog carts
In short, if you serve or prepare food and can be mobile, you will most likely need food truck business insurance.
If you own a catering business, even if you do not necessarily prepare food in your truck, van or trailer, you should still consider mobile catering insurance, as catering trailer insurance ensures the equipment in your vehicle/trailer is protected and you have general and public liability cover.
The primary difference between a food truck and a food trailer is that a food truck can be driven whereas a food trailer is usually towed by a separate vehicle.
It is important to note that the vehicle towing the food trailer must be covered by a commercial auto insurance policy as well, meaning that food trailer insurance requires further coverage.
Some mistakenly think that because their personal auto insurance policy provides liability coverage for a towed trailer, their food trailer will also be covered through it, but this is simply not the case.
Make sure you protect your food trailer by opting for the right food trailer insurance via a good small food business insurance coverage provider.
There are many food business insurance companies and providers in the states that provide food truck insurance and home food business insurance solutions.
It is essential to compare food business insurance quotes, get multiple deals, understand what insurance coverage your food truck business needs and pinpoint cheap food business insurance rates for it from the best companies.
Below we dissect food truck insurance policies from 3 popular food business insurance and food truck insurance providers.
GEICO does not offer a specific food truck insurance package but clearly lists that food trucks, work vans, and box trucks are included in their commercial auto insurance policies. Their commercial auto insurance policy covers employees operating and working within the food truck, damage to the food truck, and injury to another person or their property caused by the food truck.
• GEICO's commercial auto insurance can grow with a business and coverage limits and additional coverage can be purchased at any time.
• GEICO's commercial auto insurance for food business is a thorough coverage that is suitable for all mobile food businesses.
• Cheap rates - GEICO is known for their affordability.
• General and public liability is not included in GEICO commercial auto insurance policy.
• Since it is commercial auto insurance and not food truck insurance, it may be time-consuming and get expensive for a food truck business owner to combine their commercial auto insurance policy with other GEICO insurance policies that are essential for a complete coverage of their food truck business.
Best for: GEICO commercial auto insurance is ideal for food truck business owners just starting their culinary adventure, as their insurance policies can be easily increased as a business grows.
Average GEICO commercial auto insurance cost: $58 to $80 per month or $700 to $960 per year with $1m liability coverage.
INSURANKS RATING: 8/10
Like GEICO, State Farm does not advertise specific food truck insurance but does highlight both their food shop insurance policy and commercial auto insurance products.
State Farm commercial auto insurance covers a more comprehensive range of benefits than GEICO's, including:
• General liability insurance
• Personal injury protection
• Collision coverage
State Farm food shop business insurance is a BOP that covers:
Yes it does. State Farm's food shop business insurance is a Business Owners Policy (BOP) offered by State Farm that can be highly customized for your food business needs to include workers compensation insurance, small business insurance, commercial auto insurance and more.
• Trusted brand
• Their food shop business is very extensive and highly customizable
• Great local presence
• Excellent customer service
• Despite the fact that their food shop business insurance is very extensive, it is not a food truck insurance policy, and while regular food shop businesses might be good with just that (we do recommend these business to get more coverage), food truck businesses might want to add additional coverage to their food shop business insurance, from commercial auto insurance, to workers' compensation insurance in order to get a complete coverage of the food business. These are not included in State Farm's food shop business insurance and commercial auto insurance policies.
Best for: However, State Farm is a great all-rounder, making their commercial auto insurance suitable for all food trucks as they can tailor their insurance coverage to their specific food business needs.
Unlike both GEICO and StateFarm, Progressive provides customized food truck insurance coverage.
They have a unique Progressive Advantage® Business Program which allows food business and food truck owners to easily and efficiently match their business needs with the right food business insurance coverage.
For example, Progressive can help a food truck business get coverage for customer illness and employee injury.
Progressive does not offer estimated food truck insurance costs, as they believe food truck insurance cost should reflect the specific business, however, free Progressive food business insurance and food truck insurance quotes are available online.
• Customised food truck insurance policies for food truck business owners means a complete food business insurance policy can be bought quickly and easily.
• Estimated quote unavailable online, so businesses must contact Progressive directly.
Best for: Progressive food truck insurance is ideal for established food truck businesses or any food truck businesses who want to quickly and easily update their insurance without spending a lot of time choosing between policies and tailoring them - aka a whole solution.
Average Progressive food truck insurance cost: Varies depending on the value of the equipment.
INSURANKS RATING: 10/10
GEICO commercial auto insurance for food business: Ideal for new food businesses, or food vendors that only require part-time or one-day food vendor insurance coverage.
State Farm commercial auto insurance for food business: Safe choice for a wide range of food vendors and it has both commercial auto and food shop insurance. This makes State Farm ideal for food vendors regardless of whether or not their food business is permanently fixed/attached to their vehicle.
Progressive food business insurance via Progressive Advantage® Business Program: Progressive is first and foremost known as an auto insurance company, and along with their business program and holistic food business insurance policies, it is certainly making them the best food business insurance choice for food businesses and vendors whose equipment is permanently attached to their vehicle, e.g. food trucks.
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If you are ready to secure insurance for your food truck business, simply follow these steps:
Familiarise yourself with different types of insurance, such as the different policies mentioned previously in this guide. This will make sure you do not purchase insurance coverage that you do not need.
Once you understand the different insurance policies available for your food truck business, compare these policies against your business needs and processes. If a policy directly relates to one of your business practices, it is a good indication that you will require this type of cover. Your insurance cover should be perfectly tailored to your business so ensure you carefully compare your business against insurance policies.
Once your are ready and have a vague idea of the insurance policies you need, compare food business insurance quotes through this page. Check out the coverage offered and opt for the best offer, this will help to optimize cash flow for your food truck business and reassure its path to success!
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Policy Type: Business Insurance
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Policy Type: Business Insurance
Company name: Simply Business Insurance
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