Food businesses have unique risks, from foodborne illness claims to kitchen equipment damage. Each coverage type below addresses these risks with recommended coverage amounts.
What Insurance Do You Need for a Food Business?
The types of insurance a food business needs most include general liability, workers' comp, product liability and commercial auto coverage.
Get matched to the best food business insurer for your needs below.
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Updated: February 4, 2026
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Food Business Insurance Requirements: Key Takeaways
General liability insurance covers claim settlements, legal fees and medical expenses for food businesses' highest risks: foodborne illness claims and customer injuries (read more).
Food business insurance requirements mandate workers' compensation, commercial auto and liquor liability insurance (read more).
Product liability, commercial property and business interruption insurance provide optional coverage worth considering.
Meeting food business insurance requirements involves four steps: request a COI from your insurer, verify coverage matches contract requirements, add required parties as additional insured and renew policies before expiration (read more).
What Insurance Types Are Needed for a Food Business?
Third-party bodily injury and property damage claims from customer slip-and-falls, food poisoning allegations and accidental damage to event venues. Food businesses with direct customer contact or rented space operations need this coverage to cover claim settlements, legal defense fees and medical expenses. | Most food businesses carry $1–2 million per occurrence or $2–3 million aggregate. Restaurants and catering companies serving large events often need $3–5 million to meet venue and client contract requirements. | A catering company served chicken at a corporate event where 15 guests claimed food poisoning, with medical bills totaling $45,000. The client sued for $30,000 in event disruption costs, and legal defense fees reached $18,000. General liability covered all $93,000 in claims and legal expenses. | |
Claims alleging your food products caused illness, injury or allergic reactions. This includes legal defense costs, medical expenses and settlement payments when customers claim your products were contaminated, mislabeled or otherwise harmful. | Small food businesses carry $1–2 million per occurrence, while food manufacturers and wholesale distributors need $2–5 million. Major retailers require $5–10 million in coverage from their suppliers. | A bakery's gluten-free brownies contained trace wheat flour from cross-contamination. Three customers with celiac disease required emergency treatment costing $28,000, and the bakery faced a lawsuit seeking $150,000 in damages. Product liability covered the $28,000 in medical costs, $62,000 settlement and $35,000 in legal fees ($125,000 total). | |
Most states require this coverage once you hire your first employee. Workers' comp covers medical costs and lost wages for work-related injuries common in food businesses: burns from cooking equipment, knife cuts, slip-and-fall accidents on wet kitchen floors and repetitive strain injuries. | Your state sets the minimum coverage amount. Insurers calculate premiums based on your payroll and job classifications, with kitchen staff and cooks paying higher rates due to injury risks. Front-of-house employees cost less to insure. | A line cook suffered third-degree burns on both hands when hot oil splashed from a deep fryer. Emergency surgery, skin grafts and physical therapy cost $78,000 in medical bills. The cook lost $22,000 in wages during four months of recovery. Workers' comp paid the full $100,000, covering the employee's expenses without forcing the business owner to pay out of pocket. | |
Your building, kitchen equipment, inventory and furnishings from fire, theft, vandalism and certain weather events. For food businesses, this includes walk-in coolers, ovens, refrigeration units, point-of-sale systems and perishable inventory destroyed by equipment failure or power outages. | Coverage should equal your equipment and inventory's full replacement cost: $100,000–500,000 for small food businesses, $500,000–1 million for restaurants with extensive equipment and $50,000–150,000 for food trucks. | An electrical fire destroyed a restaurant's kitchen. The fire damaged a $15,000 commercial oven, $8,000 refrigeration unit and $12,000 in other equipment. Food inventory losses reached $6,000, and smoke damage to the dining area cost $25,000 to repair. Commercial property insurance paid the full $66,000, and the restaurant rebuilt and reopened. | |
Vehicles used for business purposes, including delivery cars, catering vans and food trucks. Forty-nine states require this coverage for business-owned vehicles. Commercial auto covers damage to your vehicle, damage you cause to others and medical expenses from accidents during deliveries or travel to catering events. | A $1 million combined single limit for liability with comprehensive and collision coverage meets most state requirements and client contracts. Food trucks serving as mobile kitchens need $1–2 million in liability coverage plus full replacement cost coverage for the vehicle and built-in equipment. | A delivery driver ran a stop sign and hit another vehicle. The collision caused $42,000 in vehicle damage and $31,000 in medical bills for the other driver. The company's delivery van was totaled — $28,000 in value lost. The accident destroyed $3,500 in catered food. Commercial auto paid all $104,500 in damages with a $1,000 deductible. | |
Lost income and ongoing expenses when your food business temporarily closes due to covered property damage like fire, storm damage or equipment breakdown. Business interruption pays for lost profits, employee wages, rent, loan payments and temporary relocation costs while your business recovers. | Coverage should replace three to six months of gross income: $50,000–200,000 for small food businesses or $200,000–500,000 for restaurants and bakeries with high overhead during extended closures for major kitchen rebuilding. | A burst pipe flooded a café's kitchen and forced a two-month closure for repairs. The café lost $45,000 in revenue but still owed $8,000 in rent. The owner paid $12,000 in employee wages to retain key staff. Business interruption paid all $65,000 in expenses, preventing bankruptcy during the closure. | |
Food Business Insurance Requirements
Business insurance requirements for food companies depend on state law and contracts. Your requirements vary based on employees, business vehicle use, alcohol service, commercial space leasing and client types.
Workers' compensation | Most states require this coverage once you hire your first employee. Violations bring fines up to $10,000 per employee, criminal charges, business license suspension and personal liability for all injury costs. Food businesses experience frequent injuries from kitchen equipment, hot surfaces, sharp knives and wet floors. | Your state sets the minimum coverage amount. Insurers calculate premiums based on your payroll and employee classifications. Kitchen staff cost more to insure than front-of-house workers due to burn, cut and slip-and-fall risks. |
Commercial auto | Forty-nine states require this coverage for business-owned vehicles, including delivery cars, catering vans and food trucks. Violations result in fines, license suspension and personal liability for accident costs. Personal auto policies exclude commercial use like food delivery or equipment transport to events. | State minimums vary from 25/50/10 to 30/60/25 split auto liability limits. Food trucks need $1 million combined single limit to meet state law and venue contracts. |
General liability | Not legally required but demanded by commercial clients, landlords, event venues and municipalities before they allow you to operate on their property. Without coverage, you'll stay limited to smaller residential catering jobs instead of landing contracts with hotels, corporate venues and medical facilities. | Most food businesses carry $1 million per occurrence and $2 million aggregate. Corporate event venues and large property management companies require $3 to $5 million. |
Liquor licensing requires this coverage in most states. Forty-three states have dram shop laws that hold you liable when overserved customers cause accidents. Landlords, licensing authorities and lenders require this coverage before approving leases, licenses or loans for food businesses serving alcohol. | State requirements start at $1 million per occurrence for restaurants. Bars and establishments with high alcohol sales need $2–3 million to meet liquor control board and commercial lease requirements. | |
Product liability | Wholesale distributors, retail chains, farmers markets and food halls require this coverage before you can sell through their channels. Product liability covers legal defense costs, medical expenses and settlement payments when customers claim your food caused illness or injury from contamination, mislabeling or improper preparation. | Venues require $1–2 million per occurrence for small food businesses. Major retailers mandate $2–5 million, while national chains require $5–10 million. |
Commercial property | Landlords and lenders require this coverage to ensure they're reimbursed if the building or equipment is damaged. Coverage must equal the replacement cost of the building, kitchen equipment and tenant improvements specified in your lease or loan agreement. | Small food businesses carry $100,000–500,000 in coverage. High-value restaurant properties with extensive kitchen equipment require $500,000–1 million. |
How to Meet Food Business Insurance Requirements
This process satisfies food business insurance requirements and maintains compliance with legal mandates, client contracts, lease agreements and licensing requirements.
- 1Request Certificate of Insurance (COI) from your provider
After purchasing food business insurance policies, request a Certificate of Insurance from each insurer. Most providers offer instant download or email delivery within minutes. You'll need COIs before signing commercial kitchen leases, starting catering contracts, or applying for health permits and liquor licenses.
- 2Verify coverage amounts match contract requirements
Review each COI to confirm policy limits meet the requirements in your contracts or applications. Requirements vary dramatically: farmers market vendor booth ($300,000), corporate catering contract ($2 million), or wholesale distribution agreement ($5 million). Food businesses juggle multiple clients with different insurance requirements. Check each COI against venue contracts, retail partner agreements or event coordinator stipulations before submission.
- 3Add venues, clients or property owners as additional insured
Event venues, corporate catering clients, and commercial kitchen landlords require additional insured status on your general liability policy before you operate on their premises. Contact your insurer to add each additional insured ($25 to $100 per endorsement) and get an updated COI. You'll need this for nearly every corporate event, festival booth or ghost kitchen rental agreement.
- 4Submit COIs to all required parties before operations begin
Submit your certificates to event coordinators before setting up at festivals or corporate functions, to wholesale buyers before your first delivery, to commercial kitchen landlords before move-in and to liquor control boards when applying for your license. A missed COI deadline costs you a catering contract, your farmers market spot or delays your restaurant opening by weeks.
- 5Maintain active coverage and proactively update all parties
Set calendar reminders 30 to 60 days before policy renewals to request updated COIs. Send new certificates to all active venues, wholesale accounts, event coordinators and landlords to prevent coverage gaps. Food businesses operating across multiple venues or with seasonal event schedules must track which clients received updated COIs. An expired certificate removes you from event rosters or halts product shipments to retail partners midseason.
Get Business Insurance You Need for Your Food Business
You can get matched to the best food business insurance company for your needs using our tool below. We still recommend comparing quotes from multiple insurers and researching providers who specialize in food industry coverage, including contamination risks, equipment breakdown and health code compliance specific to your operation.
Get Matched to the Best Food Business Insurer for Your Needs
Select your industry and state to get a customized food business insurance match and get quotes.
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About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. He has analyzed the insurance market for over five years, conducting original research for insurance shoppers. His insights have been featured in CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
He writes about economics and insurance, breaking down complex topics so people know what they're buying.