Despite the presence of fancy restaurants and bars, customers continue to love the delicious treats served by concessionaire stands, food trucks, and food stalls. As a food service business, you never need to worry about attracting customers. It's indeed an ever-popular and bustling industry. But every company faces unique challenges and risks, and the food industry is no different.
While running this type of business, you constantly face the risk of employees getting injured, customers complaining about getting ill from the food, and equipment breakdowns. These events can lead to hefty expenses and cause you a lot of stress. That's why you should need the right insurance coverage.
Who Should Get Food Business Insurance?
Concessionaire and food services insurance is a set of insurance policies designed for those engaged in this industry. It can benefit different types of enterprises, such as:
- Food trucks
- Concession stands at movie theatres
- Food carts at festivals or events
- Kiosks at malls
- Carts selling food at sports matches.
Why Do Concessionaires and Food Companies Need Insurance?
Like any other industry, a food service company can experience unfortunate circumstances leading to property damage claims, bodily injuries, and repair costs. Some of the significant risks this type of business faces are as follows.
Equipment Breakdown: This type of company requires equipment to prepare food. This includes refrigerators, ovens, burger grills, etc. If one of the pieces of equipment breaks down, the entire business can come to a standstill, and you may incur heavy repair or replacement costs.
Customer Complaints: Food carts have to deal with customer complaints. For example, A customer with food allergies may get ill after eating the food served. Your business may need to pay for the medical expenses or other losses incurred by the customer.
Employee Injuries: Employees may face injuries on the job, and the company bears the responsibility for their medical bills and lost wages while recuperating. This includes getting burned while using the grills, cuts, etc.
Lawsuits: Employees can file lawsuits for harassment, unsafe work environments, and work-related injuries. Customers may also file claims or lawsuits against you with complaints of food poisoning after eating your food, etc. You may need to pay attorney fees, court fees, and settlements.
Getting the right insurance coverage can help you tackle these risks by providing a safety net. You can concentrate on growing your profits while your insurance coverage takes care of the risks covered.
Types of Insurance for Concessionaires and Food Vendors
Based on the nature of the food service industry, you may benefit from the following insurance types:
General Liability Insurance (GL)
This is an essential and common policy you can get as a small business. It helps by covering the costs involved for third-party claims related to bodily injuries, property damages, and advertising injuries caused by your company.
Typically, GL helps protect:
- Third-party bodily injury claims and lawsuits
- Property damage caused by your company to another's property
- Advertising injuries such as copyright infringement
- Personal Injury such as wrongful detention, invasion of privacy, libel, slander
Worker's Compensation Insurance
This policy is essential as the food industry's possibility of employees getting injured is high. Due to the fast-paced nature of the job, employees may experience burns, cuts, and other injuries while working with equipment such as grills, ovens, and sharp knives. Worker's compensation insurance covers:
Employee medical expenses
- Replacement services, if injured, cannot perform for self
- Rehabilitation
- Prescriptions
- A portion of wages lost while unable to work
Business Auto Insurance
Commercial vehicle claims are generally not intended to be covered by personal auto insurance. That's where business auto insurance comes in; it is for businesses that have vehicles titled in the business name. This coverage is beneficial for food trucks, delivery, or even if you pick up your own food and supplies. It covers:
- Bodily injury for accidents where your driver is negligent
- Property damage to vehicles or other property caused by an at-fault accident
- Personal Injury or No-Fault protection if required by statute
- Comprehensive and collision on your business autos
- Uninsured or underinsured motorists' bodily injury liability (depends on state)
- Options like towing, rental reimbursement, coverage for auto wraps, or other permanently attached equipment
Equipment Breakdown Insurance
Equipment breakdowns can lead to lost revenue from interruptions in operations, thus directly affecting your profits. Equipment such as refrigeration systems, water heaters, cooking equipment, computer, and electrical systems can be covered by this policy. Coverage only applies to sudden and accidental breakdowns; it does not apply to breakdowns from wear and tear, age, lack of maintenance, etc. An equipment breakdown policy covers breakdowns caused by:
- Short circuit
- Electrical Arcing
- Power surge
- Mechanical breakdown
- Motor burnout
- Boiler damage
- Cost of Insurance
The premium paid for any commercial insurance policy depends on various factors:
- Number of employees in your firm
- Type of coverage you opt for and limits
- Value of property insured
- Annual payroll
- Location of your company
- Revenue of the business
Benefits of Getting Your Food Business Insured
There are many benefits to getting the right insurance for your company:
Minimize Financial Losses: Insurance helps reduce financial losses caused by property loss, auto accidents, equipment breakdown, and injured employees.
Share Risks: If you insure your company, you're allowing the insurer to share the burden of potential risks and liabilities with you, meaning less stress when it comes to unexpected claims.
Cover Legal Expenses: Lawyer fees and settlement liabilities can get quite expensive. Purchasing insurance can cover defense costs.
Protect your Food Business with the Right Insurance
Visit InsuranceAdvisor.com to explore the various insurance types recommended for food service companies. Our team of licensed agents can help you find the right insurance for your firm. We offer:
- Affordable prices
- Comprehensive quotes
- Easy payment options
- Helpful tips, guides, and business insights