Restaurant & bar insurance coverages
The core commercial coverages every food-and-beverage business should understand — what each does, who needs it, and what it costs.
Liquor Liability
Liquor liability insurance covers injuries or damage caused by a patron your business over-served — most often a drunk-driving crash after they leave. It pays legal defense and settlements that general liability specifically excludes. Any business that serves alcohol needs it; most states require it to hold a liquor license.
General Liability
General liability insurance covers third-party claims from ordinary restaurant operations — a customer slips on a wet floor, gets food poisoning, or has property damaged. It pays medical bills, legal defense, and settlements. Nearly every landlord requires it before leasing, commonly at $1M-per-occurrence and $2M-aggregate limits.
Workers’ Comp
Workers' compensation pays medical bills, lost wages, and disability for employees hurt on the job — the burns, cuts, and slips a kitchen produces constantly. It is mandatory in 48 states and D.C. once you hit the state's employee threshold; Texas is the only state where private employers can opt out.
Property
Commercial property insurance protects your physical assets — building, kitchen equipment, fixtures, inventory, and signage — against covered perils like fire, theft, and vandalism. Many policies add business interruption to replace lost income during a covered shutdown. It does not cover equipment that fails from internal breakdown, or liability claims.
BOP (the bundle)
A business owner's policy bundles general liability and commercial property — usually with business interruption — into one policy, cheaper than buying each alone. For a restaurant it covers customer-injury claims plus your building, equipment, and contents. It does not include workers' comp, liquor liability, or commercial auto.
Commercial Auto
Commercial auto insurance covers vehicles your food business owns and drives — paying accident liability, collision, and theft that personal policies exclude once a car is used for business. Food trucks, caterers hauling equipment, and restaurants running delivery all need it. Insureon reports food-truck commercial auto averages about $170/month; MoneyGeek puts the national per-truck cost near $259/month (2026).
Equipment Breakdown
Equipment breakdown insurance covers sudden mechanical, electrical, or pressure-system failures inside kitchen equipment — walk-in coolers, HVAC, compressors, ovens — plus the food that spoils and the income lost during downtime. Standard property policies exclude these internal failures, so nearly every restaurant, bar, and food truck needs it. Industry guides estimate roughly $500–$1,000 per year for $1 million in coverage.
Business Interruption
Business interruption insurance replaces a restaurant’s lost income and ongoing expenses — rent, payroll, loan payments — while it is closed for repairs after a covered property loss like a fire. It is almost always an endorsement inside a property policy or BOP, begins after a 24–72 hour waiting period, and does not cover pandemics or floods by default.
EPLI
EPLI covers claims brought by employees against a restaurant — wrongful termination, discrimination, harassment, and retaliation — paying legal defense, settlements, and judgments. Restaurants are high-risk because of young, high-turnover, tipped workforces. The costliest exposure, wage-and-hour claims like unpaid overtime and tip violations, is frequently excluded or capped by a sub-limit and must be added deliberately.
Liquor License Bond
A liquor license bond is a surety bond — not insurance — that many states and municipalities require before issuing a liquor license. It guarantees the licensee pays alcohol taxes and obeys liquor laws. Required amounts are set by the state (commonly $1,000–$20,000), and owners pay a premium of roughly 1–10% of that amount based on credit.
Umbrella / Excess
Commercial umbrella insurance adds liability limits on top of a restaurant’s underlying policies — general liability, liquor liability, and commercial auto — paying out after those limits are exhausted. It is sold in $1 million increments and is relatively cheap, about $40 a month per added $1 million. Landlords and lenders often require it at higher limits.
By business type
Talk to an agent who insures food & beverage every day
A licensed commercial-lines agent who specializes in restaurants and bars will review your coverage, close the gaps that catch owners, and show you what a program actually costs — before anything is bound.