Quick answer
Restaurants usually need a business owner's policy (general liability plus property), workers' compensation, and liquor liability if they serve alcohol. According to Insureon's 2026 data, food and beverage businesses pay a median of $148 a month for a BOP, $44 for general liability and $106 for workers' comp.
Key facts
- Core package
- Business owner's policy (BOP)
- Median BOP cost (food & beverage)
- $148/month (Insureon, 2026)
- Median GL cost (food & beverage)
- $44/month (Insureon, 2026)
- Median workers' comp (food & beverage)
- $106/month (Insureon, 2026)
- If you serve alcohol
- Liquor liability coverage
On this page 12 sections
Coverage a Restaurant needs
-
Business owner's policy (BOP) Essential
General liability, building or tenant property, equipment, inventory and often business interruption
Restaurants have heavy equipment and stock, and a fire or flood can close the doors for weeks.
-
General liability Essential
Customer slips, burns and food-borne illness claims
Included in a BOP; landlords almost always require it.
-
Workers' compensation Essential
Employee injuries such as burns, cuts and falls
Required in most states once you have employees, and kitchens carry high injury risk.
-
Liquor liability Essential
Harm caused by guests you served alcohol
If you hold a liquor license, general liability usually excludes these claims, and many states have dram shop laws.
-
Commercial auto / hired and non-owned auto Recommended
Delivery and catering vehicles, including staff using their own cars
Delivery drivers create auto liability for your business.
-
Cyber liability Optional
Data breaches involving card payments or online orders
Restaurants process lots of card transactions.
Estimated cost for a typical Restaurant
Estimated premium (typical setup)
$148/month
About $1,776 a year for the policies with a published median · Restaurant in the U.S.
| Policy | Priority | Median cost | Why |
|---|---|---|---|
| Business owner's policy (BOP) | Essential | $148/mo | Bundles general liability with property coverage for your space, tools and stock, usually for less than buying both separately. |
| Workers' compensation | Optional | — | With no employees, most states don't require it. Some clients ask sole proprietors to cover themselves anyway. |
| Product liability | Recommended | Varies | Covers injuries or damage caused by products you make or sell. Check that your general liability includes products-completed operations. |
Medians from Insureon's 2026 data (Food & beverage industry). Half of businesses pay less and half pay more. Your quote depends on your location, revenue, payroll, claims history and the limits you choose. "Varies" = no reliable median published.
What insurance does a restaurant need?
Restaurants face more insurance risks than most small businesses. You have customers on site all day, hot surfaces and sharp knives in the kitchen, expensive equipment, perishable inventory and often alcohol. A sensible insurance plan usually starts with a business owner's policy (BOP), which bundles general liability with commercial property and often business interruption coverage.
General liability inside the BOP covers customer injuries, such as a slip on a wet floor, and claims that your food made someone sick. Property coverage protects your equipment, furniture, inventory and (if you own it) the building. Business interruption can replace lost income if a covered event like a fire forces you to close temporarily.
Beyond the BOP, two policies are especially important:
- Workers' compensation for your staff. Kitchens have frequent burns, cuts and slip injuries.
- Liquor liability if you sell alcohol. Many states have dram shop laws, and general liability usually excludes alcohol claims for licensed businesses.
Ask your insurer about food spoilage coverage (for losses after a power outage or equipment failure) and equipment breakdown coverage for walk-in coolers and ovens. Many restaurants also consider employment practices liability, since they hire frequently.
How much does restaurant insurance cost?
According to Insureon's 2026 data from 100,000 small-business customers, food and beverage businesses pay these median monthly premiums:
| Policy | Median monthly cost |
|---|---|
| Business owner's policy | $148 |
| General liability | $44 |
| Workers' compensation | $106 |
Liquor liability, commercial auto and property for larger buildings are priced individually. Key cost factors include revenue, payroll, the share of sales from alcohol, building value, location, safety measures and claims history.
Example claims (illustrative)
Example: A customer slips on a freshly mopped floor and breaks a hip. General liability can pay medical bills and legal costs.
Example: A grease fire damages the kitchen and the restaurant closes for three weeks. Property coverage can pay for repairs, and business interruption can replace lost income.
Example: A bartender over-serves a guest who later causes a crash. Liquor liability can cover the lawsuit against your restaurant.
Example: A storm knocks out power overnight and your walk-in cooler warms up. Food spoilage coverage, if included, can pay for the lost inventory.
Is insurance required for restaurants?
- Workers' compensation is required in most states once you have employees; see workers' comp requirements by state.
- Liquor liability may be required by your state or local liquor authority, or by your lease, if you serve alcohol.
- Landlords almost always require general liability and often property coverage.
- Lenders require property coverage if you finance the building or equipment.
Choosing the right limits
Landlords commonly require general liability of at least $1 million per occurrence, the most common small-business limit according to Insureon's 2026 data. Restaurants with bars, large dining rooms or delivery fleets often add a commercial umbrella policy for extra liability protection.
Insure property at replacement cost so a fire or flood loss pays enough to rebuild and re-equip. Review your business interruption limit as well; it should be enough to cover payroll, rent and other fixed costs during a long closure.
Common gaps to watch
- Flood: standard property policies usually exclude flood; separate flood coverage may be needed.
- Equipment breakdown: mechanical failure of coolers, HVAC or ovens often needs an endorsement.
- Third-party delivery: understand how coverage works when apps or your own staff deliver.
- Employment claims: wrongful termination and harassment claims need employment practices liability.
- Cyber: card-data breaches are not covered by a standard BOP.
How to lower your premium
- Install and maintain fire suppression over cooking lines.
- Use non-slip mats and clear cleaning procedures.
- Train servers in responsible alcohol service and check IDs.
- Follow food safety rules, such as the FDA Food Code.
- Bundle coverage in a BOP and review limits yearly.
Related: catering insurance, food truck insurance and the business insurance cost calculator.
How to get Restaurant Insurance
- Gather business details
Have your seating capacity, revenue, payroll, alcohol sales share and building details ready.
- Check your lease and license
Your lease and liquor license may require specific coverage and limits.
- Build your core package
Start with a BOP and workers' comp, then add liquor liability if you serve alcohol.
- Close the gaps
Ask about food spoilage, equipment breakdown, delivery drivers and cyber coverage.
- Compare and review yearly
Compare quotes with matching limits and review coverage each year as revenue changes.
Frequently asked questions
What insurance does a restaurant need?
Most restaurants need a business owner's policy (general liability plus property), workers' compensation for employees, and liquor liability if they serve alcohol. Many also add commercial auto for delivery, food spoilage coverage and cyber liability.
How much does restaurant insurance cost?
According to Insureon's 2026 data, food and beverage businesses pay a median of $148 a month for a business owner's policy, $44 for general liability and $106 for workers' comp. Revenue, payroll, alcohol sales and location affect your price.
Do restaurants need liquor liability insurance?
If you serve alcohol, yes in most cases. General liability usually excludes alcohol-related claims for licensed businesses, many states have dram shop laws, and your liquor authority or landlord may require it.
Does restaurant insurance cover food spoilage?
Not always. Food spoilage coverage is often an add-on to a BOP or property policy. It can pay for inventory lost after a power outage or equipment breakdown. Ask your insurer whether it's included.
Does restaurant insurance cover delivery drivers?
Only if you have the right auto coverage. Commercial auto covers vehicles your business owns, and hired and non-owned auto covers liability when employees drive their own cars for deliveries.
What is business interruption insurance for restaurants?
Business interruption coverage replaces lost income and helps pay ongoing expenses if a covered event, such as a fire, forces your restaurant to close temporarily. It is often included in a business owner's policy.
Is workers' comp required for restaurants?
In most states, yes, once you have employees. The employee threshold varies by state, and Texas does not require it. Check your state's rules before hiring.
Sources
- Insureon — Small business insurance costs (2026)
- U.S. Food and Drug Administration — FDA Food Code
- U.S. Small Business Administration — Get business insurance
We cite official agencies and published industry data. See our editorial policy. Found an error? Tell us.
This guide is general information, not insurance, legal or financial advice. Coverage, exclusions and prices vary by insurer and state. Always read the policy and ask a licensed agent before you buy.