Restaurant Insurance – What it is and Average Cost

A restaurant business is one of the most lucrative businesses today. However, as your business starts to grow in size and capacity, it is important to have the right insurance so that you can protect your investment. If you are thinking of starting a restaurant business, keep in mind that liability is an issue you are going to encounter in the business. This is why you should consider restaurant insurance for your business.

Restaurant Insurance - What it is and Average Cost

A lot of things can go wrong while running a restaurant, but with the right restaurant insurance, you will get covered if a situation results in a lawsuit or you need to pay workers’ compensation benefits. If you’re still unsure whether or not to get coverage, read through this article.

What is Restaurant Insurance?

Restaurant insurance is simply a policy package that provides financial protection for not just your business but your staff and customers in the case of revenue loss, lawsuits, accidents, or fire. Note that there is no single insurance policy called restaurant insurance; instead, it refers to bundles of plans that protect restaurants, bars, cafes, and other food service activities. It protects food service providers from the risks they are likely to encounter.

How Much Does Restaurant Insurance Cost?

The average cost of this policy is $175 but there are so many factors that determine the cost of your insurance premium, and they include:

  • Employee information: The number of employees you have and what their role is determines the cost of your insurance.
  • The type of property: The type of building your restaurant is located in can determine your risk.
  • Your restaurant’s Location: The area where your restaurant is located can also affect the price of your premium. For instance, if your restaurant is located in a dangerous neighborhood, it may be at risk of damage and theft. But if it is located in a safe neighborhood, the cost will be lower.
  • Revenue: If the revenue of your business is showing substantial growth, it will make it less risky to cover, unlike a restaurant that is trying to stand on its feet.
  • The number of policies needed: If you need one more insurance policy, then you may be able to bundle them together and receive a discounted price.
  • Equipment information: The types of equipment that are available in your restaurant and how much each piece of equipment is worth.

Why is Restaurant Insurance Necessary?

Restaurant coverage is essential for all food business owners. It is a critical operating cost for restaurants and other small businesses. And this is why this insurance is so important.

It Protects your Customers

The safety of your customers should be your top priority, and this is what restaurant insurance will do for your customers. For instance, if a customer falls on your premises, your insurance will cover the cost of their medical expenses.

It Protects your Money

Sometimes paying from your pocket can be quite draining, and you may not be able to pay out of pocket to repair damage to your restaurant. You also might not be able to pay staff if an accident occurs in your restaurant, making you close down the business. This is where your restaurant coverage comes in. It helps you pay for repairs and recover lost revenue.

It helps you protect your staff

The safety of your staff should also matter to you. When your employees get injured on the job, comprehensive insurance will give them money for their medical expenses.

5 Best Restaurant Insurance Companies

When shopping for insurance for your restaurant, you have to search for affordable coverage that will help your business. Check out the list below for the best restaurant insurance companies.

FLIP (Food Liability Insurance Program)

Flip is suitable for food trucks and food vendors. If your business falls into this category, then you should consider it. Flip is affordable restaurant insurance that is designed for the food industry and has key core policies. It is a program that targets food carts, food vendors, and trucks.

When you purchase a policy from Flip, you will be given several coverage options that you can choose to add to increase the overall policy of your business. Their policy starts at $299 per month, and the process is quick and affordable.


CoverWallet is an online digital broker that helps you find all the key policies you need for your restaurant while at the same time letting you save money. The CoverWallet process ranges from $2,545 to $6,385 annually. Their quotes are accompanied by coverage limits and costs, so you are free to compare which one would be best for your business.


Traveler’s insurance is suitable for restaurants with catering services. Travelers is suitable because it has a 24/7 call center, in-house claims, etc. Also, it offers insurance to small, enterprise-level, and middle-market companies. However, it does not offer any type of online quote, and it has limited online policyholder services. However, to get a quote from Travellers, you have to contact an agent in your area who works with Travellers. You can make use of the locator to find an agent in your area.


Thimble is dedicated to insuring small businesses, and it is suitable for seasonal and special event coverage. Also, it has a commercial app that will help you manage your policy and create a COI. In addition, short-term coverage is available for special events or seasonal businesses.


Next Insurance is one of the best companies for restaurant coverage, as it has insured more than 10,000 restaurants. Interestingly, it has a custom insurance package that is designed for the food and beverage industry. It also has a commercial app that is convenient to use and helps you manage your policy and claims. Next Insurance offers a quote with three options or tiers of coverage. The tiers are broken into basic, deluxe, and premier.


Owning a restaurant can be profitable, as you tend to make a lot of money from it, but it can also be challenging. As you build your business, you need to have the right insurance in place. This insurance will not only protect your investment; it will also guarantee the safety of both your workers and customers.