Restaurant owners face unique risks: foodborne illness claims, kitchen fires and employee injuries. You'll need several coverage types to protect your business, staff and customers. Here are the essential policies with recommended amounts.
What Insurance Do You Need for a Restaurant Business?
The types of insurance a restaurant business needs most include general liability, workers' compensation, commercial property and liquor liability.
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Updated: February 6, 2026
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Restaurant Business Insurance Requirements: Key Takeaways
General liability is the top priority for restaurants due to high claim risk from customer injuries, foodborne illness and property damage (read more).
Restaurant insurance requirements commonly mandate workers' compensation, commercial auto and general liability through state law and contracts (read more).
Optional restaurant coverage includes business interruption, equipment breakdown and employment practices liability insurance.
Get COIs from your insurer, verify coverage meets requirements, add landlords as additional insured and send proof to required parties (read more).
What Insurance Types Are Needed for a Restaurant Business?
Customer injuries (slips, burns, foodborne illness). Most landlords and municipalities require this for licensing. | $1–2 million per occurrence or $2–3 million aggregate. High-traffic locations may need $3–5 million. | A customer slipped on a wet floor and broke her wrist. Medical bills and lost wages totaled $40,000, plus $8,000 in legal fees. General liability paid the full $48,000. | |
Kitchen staff injuries: burns, cuts, slips, lifting-related back injuries. Required by law in most states once you hire employees. | State-mandated minimums. Premiums based on payroll and risk classification. | A line cook suffered second-degree burns from a grease fire, requiring surgery and two months off. Workers' comp covered $34,000 in treatment and $9,000 in lost wages. | |
Building damage, kitchen equipment, furniture, inventory from fires, theft, weather. Landlords and lenders require this. | Match full replacement cost: $100,000–500,000, depending on restaurant size. | A kitchen fire caused $180,000 in equipment and ventilation damage. Property insurance covered repairs minus a $5,000 deductible. | |
Lawsuits from over-serving: on-premises fights, drunk driving accidents involving patrons. Required by liquor license authorities. | $1 million per occurrence. High-volume bars need $2–3 million. | An intoxicated patron caused a car accident after leaving. Injuries totaled $250,000. Liquor liability covered the settlement plus $45,000 in legal costs. | |
Lost income during closures from fires, equipment failures, health shutdowns. Critical for restaurants with thin margins. | Replace 3–6 months revenue: typically $50,000-200,000 based on monthly sales. | Refrigeration failure forced a two-week closure. Lost revenue ($42,000) and spoiled inventory ($8,000) were both covered during repairs. | |
Equipment breakdown | Repair or replacement of kitchen equipment (refrigerators, ovens, freezers, HVAC) and spoiled inventory from mechanical failures. Standard property policies exclude this. | $25,000–100,000 based on equipment value. Most restaurants need $50,000 minimum. | Walk-in freezer failure spoiled $12,000 in inventory and required $8,500 in emergency repairs. Equipment breakdown reimbursed all $20,500 within days. |
Restaurant Business Insurance Requirements
Restaurant insurance requirements include state-mandated coverage and contractual obligations from landlords, lenders and liquor licensing authorities. Workers' compensation and commercial auto insurance are legally required, while general liability and property coverage are typically mandated by leases and business licenses.
Workers' compensation | Required by law in most states once you hire employees. Penalties include fines up to $10,000 per employee, criminal charges, license suspension and personal liability for injury costs. Restaurant kitchens face high injury rates from burns, cuts and slips. | State-mandated minimums based on payroll and industry classification. Restaurants are classified as high-risk. |
General liability | Commercial landlords require this before signing leases. Municipalities mandate it for business licenses and health permits. Premium locations and high-traffic venues demand higher limits. | Standard requirement: $1 million per occurrence, $2 million aggregate. High-value landlords may require $2–3 million. |
Commercial auto | State law requires this in 49 states for business vehicles used for delivery, catering or supply transport. Personal auto policies don't meet legal requirements. Penalties include fines, vehicle impoundment and personal liability. | State minimums: 25/50/10 to 50/100/50 split limits. Delivery restaurants often need $1 million combined single limit. |
Liquor liability | State licensing authorities require this before issuing or renewing licenses for restaurants serving alcohol. Dram shop laws impose strict liability for over-service incidents. | Most states require $1 million per occurrence minimum. High-volume bars may need $2–3 million. |
Commercial property | Landlords mandate this in commercial leases to protect building investment. Lenders require it for financed properties with lender named as loss payee. Coverage required for entire lease or loan term. | Must equal full replacement cost of building, equipment and inventory: $100,000–500,000 based on restaurant size. |
Premium shopping centers, luxury hotels and high-traffic locations require coverage above base liability limits. Major landlords won't lease without this additional protection. | High-value locations: $2–5 million total coverage. Luxury venues may mandate $5–10 million. | |
How to Meet Restaurant Business Insurance Requirements
Restaurant owners must maintain proof of insurance to satisfy landlords, liquor licensing authorities and municipal requirements. Follow these steps to document coverage and stay compliant after purchasing policies.
- 1Request Certificates of Insurance (COIs) from your insurance provider
Request COIs from your agent immediately after purchasing coverage. Most providers deliver them via email within minutes to hours. You'll need COIs before signing leases, obtaining business licenses, securing liquor permits and partnering with delivery platforms like DoorDash or Uber Eats.
- 2Verify coverage amounts match lease and licensing requirements
Compare each COI against your lease agreement, liquor license requirements and business license. Confirm limits meet specified minimums. Your general liability should show $1 million/$2 million coverage, and liquor liability must satisfy state licensing authority minimums.
- 3Add your landlord as "Additional Insured" on general liability coverage
Commercial leases require adding the property owner as an additional insured on your general liability policy. This protects them from claims arising from your restaurant operations. Request this endorsement from your insurer (costs $25 to $100 annually) and get an updated COI showing the landlord's additional insured status.
- 4Submit COIs to landlords, licensing authorities and delivery partners
Provide certificates to your landlord before lease signing, to your state liquor authority when applying for alcohol licenses and to your health department for business permits. Restaurants offering delivery must also submit commercial auto COIs to third-party platforms before activating service.
- 5Set renewal reminders and distribute updated certificates proactively
Set calendar reminders 30 to 60 days before policy renewals to obtain updated COIs, especially if renewals align with liquor license or lease term dates. Send new certificates annually to your landlord, liquor authority, health department and delivery partners to avoid license suspensions or lease violations.
Get Business Insurance You Need for Your Restaurant Business
You can match with insurers specializing in restaurant coverage using the tool below. Compare quotes and evaluate each provider's experience handling restaurant claims, coverage options for liquor liability and equipment breakdown, and understanding of food service operations. Review premiums alongside coverage limits to ensure adequate protection for your operation.
Get Matched to the Best Restaurant Business Insurer for Your Needs
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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.