Business Owner’s Policy for Food Service Businesses

A business owner’s policy, also referred to as BOP insurance, is an insurance bundle that includes multiple types of coverage. It helps to protect your business from unexpected expenses related to common risks and accidents. 

What does a Business Owner’s Policy cover for food services?

BOP insurance covers a wide range of basic risks that apply to the food services industry, including property damage, medical payments and lawsuits.

Business owner’s policies include two important types of business insurance — general liability insurance and commercial property insurance — in one package. Getting a business owner’s policy is usually less expensive than buying these two types of coverage separately.

BOP insurance helps cover several different accidents and risks that can occur at food service businesses, such as:

• Injuries to people who are not employees
• Damage to someone else’s property
• Accusations of libel and slander
• Damaged equipment and inventory
• Lost income
• Repairs to structures

Why do food service businesses need BOP insurance?

Food service involves a lot of interaction with customers, vendors and other people besides employees. If something happens to them or your property, you could be held liable for the damages incurred. Because a business owner’s policy includes general liability insurance, it can help protect your food service business financially when these types of accidents occur.

Most food service businesses also need equipment and inventory to operate daily. If something happens to that property, it could have significant financial ramifications. BOP insurance includes commercial property insurance, which helps cover a number of incidents involving equipment and inventory and the physical location of your business.

For example, a business owner’s policy can help pay for a customer’s medical bills if they slip and fall in your restaurant’s parking lot. Similarly, if there’s a fire at your coffee shop, BOP insurance can help cover lost income and the costs to set up in a new location.

Having the right food business insurance means that you may not have to pay as much out of pocket if an accident occurs. With BOP insurance coverage, you can focus on your work without constantly worrying about those worrisome “what if” scenarios.

In addition, the coverage included in a business owner’s policy can help you reach your business goals.

General liability, which is included with a business owner’s policy, is highly recommended for restaurant insurance, food vendor insurance, and other food service businesses since it’s often required to get licenses and permits.

Similarly, many landlords require property insurance before you can rent commercial space for your business, so BOP coverage combines policies you might have already needed to buy.

What are some common risks faced by food service businesses?

In the food service industry, there are several types of risks that you could encounter while working with clients, vendors and property that doesn’t belong to you. That’s why it’s so important to have food liability insurance.

Here are some common risks you might come across:

Property damage

One of your restaurant servers accidentally spills a tray of drinks on a customer’s designer purse. BOP insurance can help cover cleaning or replacement costs.

A business owner’s policy can also help pay for incidents affecting your own property, like equipment breakdowns, inventory theft, or damage from a storm, burst pipe or fire.

Accidents that hurt someone

A customer slips on a freshly mopped floor at your grocery store. Your BOP insurance can help pay for an injured person’s medical expenses up to your policy limit, excluding employees and yourself.

Libel, slander and defamation

Your catering company is accused of claiming that a competitor’s food is substandard in one of your online advertisements. General liability coverage in your BOP insurance can help pay legal fees if the business owner sues you for defamation.

Business income interruptions

A fire at your bakery causes your business to shut down temporarily. With commercial property coverage in your business owner’s policy, you’ll get help covering some of your lost income until you can reopen.

What is the cost of BOP insurance for food businesses?

NEXT customizes insurance policies to provide tailored coverage for each business. Costs for BOP insurance vary based on factors like the type of work you do, your business location, your claims history and more.

For restaurant liability insurance, the median cost of general liability coverage is $74 per month, and the median commercial property coverage cost is $98 monthly.**

One of the perks of BOP insurance is that you can immediately save up to 10% on your insurance costs. A business owner’s policy combines general liability and commercial property insurance into one package that is typically less expensive than buying coverage separately.

How can food businesses save money on BOP insurance?

There are several ways to lower your premium rates and reduce your BOP insurance costs:

Keep your risk level low

Consider implementing a safety and training plan to help lower the risk of accidents and claims that could potentially raise your insurance costs.

Learn from previous claims

Take a closer look at any previous insurance claims you’ve filed to determine what you could have done to avoid those risks.

Pick the right limits and deductible

Think about how your limits and deductibles affect insurance costs. If you choose lower limits, you’ll spend less on premiums but have higher exposure to risks if you don’t get enough coverage. If you go with a higher deductible (the amount you pay before your insurance kicks in), you’ll pay less for the policy.

NEXT offers tailored business insurance for food services

NEXT offers convenient, affordable insurance for restaurant owners, personal chefs and other food service entrepreneurs. We make it easy to find the coverage that’s right for you so you can protect your business day in and day out.

Our online services allow you to apply whenever it’s convenient for you using any computer or mobile device. You can compare insurance options, purchase coverage and get a certificate of insurance in just minutes.

Get an instant quote online today.

More about Food Business Insurance

• General liability insurance for food services
• Workers’ comp insurance for food services