Average Restaurant Business Insurance Cost (2026 Report)

A business owner’s policy (BOP), which bundles general liability and commercial property, costs restaurants around $224 per month, or $2,692 per year. I got the rates by combining the average cost of these two coverage types for full-service restaurants, then applying a 10% bundling discount. 

Our data shows that BOP costs for restaurants are highest in California at about $318 per month, nearly twice the average rate in West Virginia at $173 per month. California’s higher rate likely reflects the cost of insuring restaurants in larger, busier markets, where customer claims, legal costs, equipment repairs and property replacement can be more expensive. West Virginia has a more affordable insurance environment, with smaller dining markets and lower repair or replacement costs.

On average, restaurants spend around $137 per month, or $1,645 per year, for general liability insurance. It can help if a guest slips near the entrance, a vendor gets hurt in a service area or a customer’s belongings are damaged while they’re dining. State laws don't require general liability, but landlords often include them in lease agreements. You could also have clients who ask for proof of liability coverage before you can start work.

General liability costs about $91 per month for restaurants in West Virginia, likely due to the state’s smaller dining markets, less dense customer traffic and lower-cost claims environment. If you're located in California, you’ll spend about $224 per month for the same coverage, roughly 2.5 times West Virginia’s rate. California has busier metro and tourist markets, where customer injury claims, property damage claims and legal defense can cost more to insure.

A commercial property policy costs around $112 per month, or $1,346 per year, and covers your restaurant if a fire, theft, water leak or storm damages items you rely on to operate. Your premium depends partly on the value of your kitchen equipment, furniture, fixtures, inventory and upgrades you made to the space. Costs can also rise if those items would be expensive to repair or replace.

My analysis of commercial property costs found that restaurants in New York see a monthly average of about $133, while those in North Dakota spend $35 less at $98. Commercial property is tied more directly to the items you insure, such as kitchen equipment, furniture, fixtures, signage, inventory and leasehold improvements. New York’s higher repair and replacement costs still push rates up, but your restaurant’s own property value usually matters more than location.

Most states require workers’ compensation once you have employees, so check your workers’ comp requirements before hiring. Without it, you could be left handling medical costs or wage-related claims from injuries such as kitchen burns, knife cuts, slips, lifting strains or cleanup accidents.

Based on our study, you'll spend about $34 per month per employee on average, though that figure will vary depending on your state. Workers' comp costs are around $79 per month per employee if your restaurant's based in California, since operate in a higher-cost claims environment, where medical care, wage replacement and claim handling cost more. In Indiana, you’ll pay about 76% less at $19 per month per employee.

Not all restaurants need cyber insurance, but consider adding it to your policy mix if you use online ordering, delivery apps that store customer information, reservation platforms or POS systems. If your digital vendors or contracts require coverage, check your cyber insurance requirements to make sure your limits are high enough.

Expect to spend about $104 per month or $1,253 per year, but at the state level, full-service restaurants in Washington, D.C., pay about $129 per month. That higher cost reflects how restaurants operate in a dense city: more customers can mean more card payments, online orders, reservations, delivery-app transactions, and POS activity. In North Dakota, cyber insurance costs about 31% less, at $89 per month as smaller dining markets often have fewer daily digital transactions.

If your restaurant uses a business-owned vehicle for deliveries, catering, supply runs or other business driving, you’ll need commercial auto insurance. It costs about $219 per month, or $2,625 per year, on average. Check your commercial auto requirements if your restaurant vehicle is covered by a lease, lender agreement, delivery contract or local rule.

The average cost for commercial auto insurance ranges from $109 per month in Pennsylvania to $418 per month in Michigan. While it’s one of the costlier coverage types you can add to your bundle, you’ll only need it if your restaurant owns a vehicle for deliveries, catering, supply runs or other business use.

Depending on how you run your restaurant, you may face risks tied to alcohol service, expensive food inventory, refrigeration, cash handling or employee management. In those situations, you may need specialized policies beyond the five common restaurant coverages.

I researched these specialized restaurant coverages and broke them down in the table below. The cost ranges aren't from our insurance cost study, but they’re based on external research and can help you estimate how these add-on policies affect your total cost.