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One of the crucial steps you have to take when running a food or bakery business is having food liability insurance.
Liability insurance is a common inclusion in tailored insurance for different businesses in the food industry, whether they be a coffee shop, catering business, pizza delivery or food delivery
This article shares light on food liability insurance; how it works, premium costs, and carriers providing the best coverage at the most reasonable rates.
As said earlier, liability coverage in food insurance for farmers’ markets, bakeries, distilleries, vendors, vending machine businesses, and liquor stores comes in different types. Nonetheless, the most common food liability insurance coverages available are:
| CoverWallet | NEXT (Best) | Thimble | Hiscox | FLIP | |
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 | $1,000,000 | $1,000,000 |
| Aggregate limit | $2,000,000 | $2,000,000 | $1,000,000/$2,000,000 | $2,000,000 | $2,000,000 |
| Products and completed operations aggregate limit | $2,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 |
| Advertising injury coverage aggregate limit | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 | $1,000,000 |
| Tenant’s legal liability coverage limit | $1,000,000 | $100,000 | $5,000 | $100,000 | $300,000 |
| Waiver of subrogation included? | Yes | No | Included | Can be included | Excluded |
| Hired/non-owned auto liability coverage included? | Yes | No | Excluded | Can be included | Excluded |
| Equipment breakdown floater included? | No | Yes | Yes | Can be included | Yes |
| Can you get a certificate of insurance online? | Yes | Yes | Yes | Yes | Yes |
| Name additional insureds? | Yes | Yes | Yes | Yes | Yes |
| Deductible | $0 | $0 | $0 | $0 | $0 |
Slip and fall accidents are a common peril when running a food business. As proof, you should know that an estimated $1 million guests experience slip and fall accidents in restaurants every year.
This food business insurance covers:
Customers might experience allergies upon consuming the product of your food business.
Food product liability insurance will take care of attorney fees, settlements, administrative costs, and other legal expenses if your food business caused or allegedly committed food poisoning or food mishandling.
In other industries, this insurance also covers claims filed because a product has:
Product liability insurance is available as a stand-alone policy. However, this is sold by food processing insurance companies as additional coverage to general liability insurance.
Insurance companies will offer professional liability insurance if your business doesn’t only sell food but also offer food preparation, manufacturing, and other related services for clients.
Professional liability insurance’s job is to cover attorney fees, settlements, administrative costs, referral fees, retainer fees, contingency fees, and other legal expenses when a customer sues for:
| CoverWallet | NEXT | Thimble (Best) | Hiscox | FLIP | |
| Per occurrence limit | $1,000,000 | $1,000,000 | $1,000,000/$2,000,000 | $1,000,000 | $100,000 |
| Aggregate limit | $2,000,000 | $2,000,000 | $1,000,000/$2,000,000 | $1,000,000 | $200,000 |
| Name additional insureds? | Yes | Yes | Yes | Yes | Yes |
| Waiver of subrogation included? | Yes | No | Yes | Can be included | No |
| Deductible | $500 | $500 | $500 | $50/$10,000 | $500 |
Commercial Property Insurance
Insurance companies encourage food businesses owning, renting, or leasing a commercial space to include commercial property insurance in their tailored coverage for selling food.
Commercial property insurance provides protection against:
| CoverWallet | NEXT (Best) | Thimble | Hiscox | |
| Building coverage limit (minimum) | $50,000 | $730,000 | $25,000/$500,000 | $25,000 |
| Contents coverage limit (minimum) | $50,000 | $22,000 | $25,000/$500,000 | $25,000 |
| Outdoor signs | Excluded | $2,500 | Excluded | Excluded |
| Accounts receivable | Excluded | Excluded | $5,000/$10,000 | Included |
| Money and securities | Excluded | $2,500 | $1,000 | Included |
| Lock and keys | Excluded | $2,500 | Excluded | Excluded |
| Business interruption floater | Excluded | Included | Included | Included |
| Equipment breakdown floater | Excluded | Included | Excluded | Excluded |
| Inland marine insurance floater | Excluded | Excluded | $10,000 | Excluded |
| Employee dishonesty floater | Excluded | $5,000 | $2,500 | Included |
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A business owner’s policy is underwritten for small-time food businesses, typically those with a revenue of $1 million or less per year.
A business owner’s policy combines general liability and commercial property insurance. Therefore, it grants protection against lawsuits and commercial losses.
Buying a business owner’s policy is much cheaper than buying general liability and commercial property insurance on their own.
| CoverWallet | Thimble | NEXT (Best) | Hiscox | |
| General liability aggregate limit | $2,000,000 | $2,000,000 | $2,000,000 | $300,000/$2,000,000 |
| Commercial property coverage limit | $50,000 | $500,000 | $720,000 | $25,000 |
| Optional policies can be added? | Yes | Yes | Yes | Yes |
| Name additional insureds for free? | Yes | Yes | Yes | Yes |
| BOP discount? | Yes | Yes | Yes | Yes |
This policy covers the stoves, slicers, mixers, dicing machines, refrigerators, ovens, griddles, fryers, and other cooking and tools you own and use for commercial purposes.
Equipment and tools insurance will cover replacement or repair expenses if your kitchen implements get lost or damaged because of:
When employees or an employee suffers from a work-related injury or disease, your food business must provide help.Thats where workers compensation comes in to cater for the following for the employee cost incase of;
Commercial auto insurance is essential if you’re the owner of a food truck, food trailer, a concession trailer, an ice cream truck, or any other mobile food business:
The food business insurance cost depends on your location, revenue, number of employees, business history, claims history, and other factors. But still, the average food liability insurance cost (a general liability insurance to be specific) is $27 per month or $324 per year for a $1 million coverage.Get
Home-based food manufacturers such as small candy makers, chocolate makers, pastry professionals, and others can get coverage through cottage food insurance.
Liability insurance for cottage food business include general liability insurance with product liability coverage, and professional liability insurance.
Aside from cottage food liability insurance policies, there is also commercial property insurance with equipment breakdown coverage, and workers’ compensation insurance.
Best Food Liability Insurance Companies
NEXT’s general liability insurance comes with a foodborne illness coverage. You can choose to bundle this with commercial property insurance, workers’ compensation insurance, in a business owner’s policy.
NEXT allows you to add additional insureds, pay premiums online, and get free certificates of insurance.
Average cost: $25 per month
CoverWallet offers an online quotes comparison platform you can use to find carriers providing general liability insurance and other coverages for food businesses.
CoverWallet allows you to add clients as additional insureds, pay premiums online, and get a certificate of insurance for free.
Average cost: $26 per month
Get all the best quotes from leading providers in a click of a button!
It offers general liability, professional liability, and other insurance products for food businesses. You need to speak with a representative to get covered.
Average cost: $27 per month
Hiscox offers general liability coverage for food trucks and other related businesses. You can decide to get a business owner’s policy to enjoy the protection commercial property insurance provides.
It provides worldwide coverage-meaning that your food business is covered no matter which country it is located.
Average cost: $28 per month
Thimble’s general liability insurance is available for grocery stores, restaurants, food stands, food trucks, and other related businesses. It is available as an annual or short-term policy lasting for only hours, weeks, days, or months.
Coverages you can buy together with Thimble’s general liability insurance are workers’ compensation and commercial property insurance.
Average cost: $30 per month
Our rating: 8/10
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