Restaurant business insurance
Restaurant business insurance is business insurance designed for restaurant owners and operators in the UK. It is intended to help protect the business against the risks that come with running a restaurant, including customer injury claims, employee injury claims, food related allegations, damage to premises or equipment, stock loss and business interruption.
What does restaurant business insurance cover?
Restaurant business insurance can include protection for liability claims, property damage, stock loss, equipment damage and loss of income after insured damage. Depending on the policy you choose, you can also add cover such as loss of licence, equipment breakdown, legal expenses and cyber liability.
A typical restaurant business insurance policy can include:
Restaurant public liability insurance
Covers claims from customers, suppliers or visitors who allege injury or property damage linked to your premises or business activities.
Product liability insurance
Covers claims alleging illness or injury caused by food or drink you have supplied, including food poisoning or allergen allegations.
Employers’ liability insurance
Covers claims from employees who suffer injury or illness through their work. If you have employees, you will usually need this cover by law.
Buildings insurance
Covers damage to premises you own caused by insured events such as fire, flood or vandalism. If you lease the property, check whether your landlord insures the structure.
Tenant’s improvements insurance
Covers physical damage to tenant-owned property, such as alterations, renovations, or customisations made to a leased property.
Contents and kitchen equipment insurance
Covers general fixtures, fittings, furniture, kitchen and catering equipment against insured loss or damage.
Computers & electronic business equipment insurance
Covers computers, front of house IT & EPOS equipment against damage or loss.
Stock insurance
Covers food, drink, dry goods and packaged supplies against insured loss or damage.
Business interruption insurance
Covers loss of income and ongoing costs if your restaurant cannot trade after insured damage such as fire or flood.
Options and levels of indemnity
For restaurant public liability insurance, common limits in the UK are £1 million, £2 million and £5 million, but higher limits are available if preferred or where required under a contract or by a landlord. Employers’ liability insurance must be at least £5 million by law, although many insurers provide £10 million as standard. Buildings, contents, stock and business interruption should be insured at reinstatement values, as underinsurance can reduce claim payments.
Optional cover and policy extensions
Depending on how your restaurant operates, optional cover and policy extensions are available to widen your protection and tailor your cover to suit your business requirements. You can also opt to include:
Loss of licence
where alcohol sales form part of your turnover
Deterioration of refrigerated stock
where equipment failure could spoil chilled or frozen stock
Equipment breakdown
if you rely on refrigeration, extraction or specialist kitchen equipment
Money cover
if you handle cash on site or in transit
Goods in transit
if you move stock or equipment for catering or delivery
Legal expenses insurance
for certain disputes or legal costs, depending on the cover selected
Cyber insurance
if you rely on EPOS, card payments, online ordering or stored customer data
Directors’ and officers’ liability
to assist in the event of claims relating to management decisions, alleged breaches of duty or regulatory investigations
Common exclusions and important considerations
Cheap restaurant insurance can look competitive at quote stage, but lower premiums may mean inferior cover, lower limits or gaps in cover. Ensure the policy you buy provides the correct cover for your business. You should check exclusions, policy conditions and sums insured carefully.
Check the policy covers all your business activities & operations such as takeaway, delivery, outside catering or live music and entertainment.
Check your sums insured are accurate reinstatement values to avoid underinsurance.
Look out for:
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Kitchen equipment cleaning and maintenance requirements
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Fire suppression protection requirements in the kitchen areas
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Fire alarm testing & maintenance requirements
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Intruder alarm requirements
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CCTV requirements
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Laundry requirements
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Flood exclusion or increased excess
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Increased public liability excesses
Who needs restaurant business insurance?
Anyone who owns or runs a restaurant should consider taking a commercial package restaurant insurance policy to provide protection for their business.
Cover can be arranged for:
- Restaurants with takeaway or delivery
- Specialist restaurants
- Restaurants with live music or entertainment
- Restaurants also providing outside catering
- Independent restaurants
- Restaurant chains
- Fine dining restaurants
- Licensed restaurants
Why restaurant business insurance is important
Restaurants face many risks on a day-to-day basis from customer footfall to food service, kitchen fire risk, employee claims and dependence on stock and equipment.
One serious incident can lead to claims resulting in legal costs, compensation, repairs, wasted stock and interruption to trading.
A comprehensive policy can provide:
- Protection against customer, employee and food-related claims
- Cover for property, stock and kitchen equipment
- Support after insured damage stops you trading
- Protection that reflects restaurant-specific risks
- Support to keep your business trading after a serious loss
- Support in meeting legal and contractual requirements
The best restaurant insurance is usually the cover that is tailored to match your trading model, premises and risk profile, rather than the lowest premium.
Where can restaurant claims arise?
Restaurant claims often arise from day-to-day trading rather than unusual events. Common examples include:
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Slips, trips and falls in customer or staff areas
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Food poisoning or allergen allegations
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Employee burns, cuts and manual handling injuries
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Kitchen fire, smoke or water damage
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Refrigeration failure and spoiled stock
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Theft, cash loss or damage to equipment
What does restaurant business insurance cost?
The cost of restaurant insurance depends on your business, not a fixed market rate. Premiums are usually based on your premises, location, turnover, staffing, claims history, cooking methods, additional business activities or entertainment, sums insured and the additional cover options you choose.
Key rating factors include:
- Your premises location
- Number of employees & wage roll
- Turnover, customer footfall & number of covers
- Whether you sell alcohol, provide activities or entertainment
- Use of fryers or other higher-risk cooking methods
- Values for buildings, contents, stock and improvements
- Claims history
- Risk management, including security and fire precautions
Premiums are determined by the overall risk presentation of the business, not any single factor in isolation.
Why choose David J Miller Insurance Brokers?
David J Miller Insurance Brokers is an independent, FCA-regulated UK insurance broker with many years of experience arranging insurance for restaurants. We provide a personal service, access to a range of insurers and specialist underwriters and practical support if you need to make a claim.
- Wide market access: ability to approach multiple insurers and specialist restaurant insurance underwriters to find appropriate terms for your risk
- Practical assistance in the event of a claim at your restaurant, guiding you through every step
- Established since 1965
- Over 50 years of insurance experience
- Family run business
- Independent insurance broker
- FCA-regulated
- Personal UK-based support, including claims assistance
How to get a restaurant business insurance quote
Getting an insurance quote for your restaurant business is straightforward. We collect the information insurers need, approach our panel of suitable insurers and advise you of the quotations available.
Restaurant business insurance FAQs
Do I need restaurant business insurance?
If you have staff, you will usually need employers’ liability insurance by law. Most restaurants should also consider cover for customer claims, food related claims, property damage, stock loss and business interruption.
What insurance does a restaurant need?
Most restaurants need public liability, product liability, employers’ liability, contents and equipment cover, stock cover and business interruption. The right cover depends on your premises, activities and whether you serve alcohol, provide entertainment or additional services such as outside catering or delivery.
How much does restaurant insurance cost?
Restaurant insurance cost varies by business. Basic policies are available, which can often be much cheaper than a policy tailored to meet your specific needs. Premiums can also be higher where additional services or entertainment are provided.
Do restaurants need public liability insurance?
Restaurant public liability insurance is not usually a legal requirement, but it is often essential in practice because restaurants are public facing businesses. Your lease, contracts or venue requirements may also require it.
Is restaurant insurance a legal requirement in the UK?
Employers’ liability insurance is usually compulsory if you employ staff, while other sections may be optional dependent on your risk profile, lease and contracts.
Does restaurant insurance cover food poisoning and allergen claims?
It can, if the policy includes the right liability cover and the policy is arranged correctly to reflect the food and drink you supply, but you should not assume it is automatic.
Do I need employers’ liability insurance for restaurant staff?
Yes, usually. If you employ staff, employers’ liability insurance is generally required by law.
What level of public liability cover does a restaurant need?
That depends on your contracts, landlord requirements, customer risk exposure and overall risk profile. Common limits for restaurant public liability insurance include £1 million, £2 million and £5 million but higher limits are available where required.
Will business interruption insurance cover closure after a fire or flood?
If you have opted to include business interruption cover in your policy it can, where the interruption to the business follows insured damage covered by the policy. The cause, indemnity period and policy wording will determine the outcome.
Do licensed restaurants need loss of licence cover?
Not always, this cover is optional, but it may be worth considering if alcohol sales are an important part of your turnover.
What information do I need to get a restaurant insurance quote?
You will usually need details about your premises, turnover, staffing, cooking methods, claims history and the value of your stock, contents and equipment. Our restaurant insurance proposal form helps us to collect the appropriate information.
Does restaurant insurance cover equipment breakdown or spoiled refrigerated stock?
It can, but these sections are not always included as standard. You should check whether equipment breakdown and deterioration of refrigerated stock are specifically covered.