How Much Does Restaurant Insurance Cost?

Restaurant owners in the United States pay around $2,149 per year for a Business Owners Policy with $1,000,000 in general liability coverage and $100,000 in business personal property coverage, or about $179 per month.

Farmer Brown has placed restaurant insurance policies across all 50 states since 1996. Owners can get a quote in minutes using the form below.

That $2,149 figure is for a full-service restaurant with no employees and $150,000 in annual revenue. Prices go up with revenue, number of employees, and location. A restaurant owner with poor credit can pay two or three times that rate.

What restaurant insurance covers

A standard BOP has two main parts. General liability covers bodily injury, property damage, and personal and advertising injury. If a customer slips on a wet floor or gets food poisoning and sues, general liability is what pays for legal defense and any settlement.

Business personal property covers contents such as kitchen equipment, furniture, point-of-sale systems, and inventory. Over 7,000 restaurants catch fire every year in the United States. If a fire destroys the kitchen, this coverage pays to replace it.

Most restaurant BOPs also include a restaurant endorsement covering contamination and food spoilage, typically with a $50,000 limit and a $2,500 deductible.

Business income coverage is also typically included. If a covered event forces a temporary closure, it pays for the revenue lost during that period.

Two other policies come up often for restaurant owners. Liquor liability covers damages caused by intoxicated customers and runs around $538 per year. It is separate from a BOP and only applies if the restaurant serves alcohol. Workers compensation covers workplace injuries, medical bills, and lost wages. It is required in most states once a restaurant has employees, and it averages $1,359 per year across the industry. A worker is injured on the job every seven seconds in the United States.

What affects the price

Revenue is the biggest driver. The more a restaurant brings in, the more exposure an insurer sees, and the higher the premium. Payroll works the same way.

Location matters more than most owners expect. Rates vary by state because average claim costs and legal environments are not the same across the country.

Credit is the factor that catches people off guard. Insurers run a soft credit check during the quoting process, and the result moves the price. Owners with poor credit can see rates two or three times higher than owners with clean credit profiles. The premium is not just about the restaurant; it is also about the owner.

Liquor sales push the number up further. Once alcohol crosses 50% of total revenue, carriers treat it as a different risk category entirely.

Restaurant insurance costs by coverage level

Note: Premiums depend heavily on location and the personal credit of the business owner. Rates can vary widely. Rates are subject to underwriting acceptance and review. Any quote is not an offer of insurance.

How to get a lower rate in restaurant insurance 

Getting quotes from multiple carriers is the fastest move. Rates vary by carrier even for identical restaurant profiles, so a single quote is rarely the best one available.

A clean claims history helps. Carriers look at how many times a business has filed, and a restaurant with no prior claims qualifies for better pricing than one with a pattern of losses.

Fire suppression systems can earn meaningful discounts. So can raising the deductible. Standard deductibles on restaurant policies run $500 for business personal property and $2,500 for the restaurant endorsement. Moving either of those up reduces the annual cost.

Owners who want to talk through their options before buying can schedule a call with a licensed Farmer Brown agent.