Restaurant Insurance Programs - How to Save on Premiums

There are numerous types of insurance that a restaurant needs. The following are the types of insurance policies that any restaurant should purchase.
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restaurant insurance programs

Written by Brian Greenberg
CEO / Founder & Licensed Insurance Agent

Last updated: July 1st, 2022

Reviewed by Grant Desselle
Licensed Insurance Agent

While every restaurant needs insurance to protect its assets from unexpected losses, insurance premiums can be costly. For example, a typical small restaurant spends about $100 monthly for a business owner’s policy and $115 every month for worker’s compensation insurance. That’s an annual cost of $2,580 for purchasing only two policies. Fortunately, there are strategies that restaurants can adopt to help save on premiums.

What Types of Insurance Does a Restaurant Insurance Program Include?

There are numerous types of insurance that a restaurant needs. The following are the types of insurance policies that any restaurant should purchase.

  • General Liability Insurance

This type of restaurant insurance safeguards the business from any legal costs and other costs that are associated with any lawsuits due to any incident that causes damage of property or bodily injuries. It settles all the financial loss related to any harm to clients or customers.

  • Workers Compensation Insurance

A workers compensation policy safeguards restaurants from any legal costs related to employee injuries while at work. The insurance covers rehabilitation costs and hospital fees. It also pays for any lost salaries if the worker needs some time off to recover.

  • Commercial Property Insurance

It covers any costs related to damage of the physical business assets of the restaurant. The insurance pays for any expenses associated with loss, or damage to property.

  • Cyber Liability Insurance

It secures restaurants from legal and monetary losses associated with data breaches. Threats to customer data have become more prevalent as restaurants are preferring the use of digital platforms to manage their transactions.

  • Crime Insurance

Crime insurance provides cover against theft including forgery of documents, burglary, and extortion. Restaurants are often a target of criminals and having coverage is essential.

What are Some of the Elaborate Ways to Save on Costs?

  • Bundle with a Business Owners Policy

Bundling your policies helps you get better prices and coverage. One of the most effective and easiest ways to save money on your restaurant insurance policies is to bundle them up with only one carrier. This way your restaurant can enjoy a multi-policy discount. It also ensures that there are no gaps in coverage.

  • Increase Your Deductible

Raising your deductible will save you money on your restaurant insurance costs. The insurance deductible directly affects how much you get paid in a claim, but can also save you thousands of dollars when it is increased using the right strategy. It works well if your restaurant can pay for small issues without filing an insurance claim.

  • Loyalty Discounts

Loyalty discounts seem to be a win-win scenario: the insurance company reaps the benefits of a loyal customer and the insured gets a discount. The loyalty discount can only kick in if you’ve been a loyal customer for several years. When it comes to your restaurant insurance coverage it can mean a huge difference in terms of your monthly rate.

  • Restaurant Insurance Programs / Group Rates

Insurance premiums can be expensive for restaurants but with group rates, the economies of scale apply. Utilizing group purchases enables you to have greater buying power. With groups, you avoid any costly administration fees and save on costs without sacrificing the quality of your insurance plan.

  • Safety Discounts

Checking your eligibility for safety discounts and applying for them can help you cut costs. If your restaurant recently added new security features or underwent any special safety training, applying for safety discounts and getting a new liability quote can be beneficial.

  • Buying Package Policies

Buying package policies helps cut costs rather than buying several individual policies. Restaurant businesses can purchase a policy that includes both commercial property liability and general liability. Many commercial coverages come in a package policy including crime, business auto and inland marine coverages.

  • Paying Premium in Advance

Because premiums are a huge expense, restaurants can opt to pay the premium in quarterly or monthly installments rather than all at once. Through such an arrangement one can get a discount or other incentive.

What to Bundle for Program Cost Savings?

Some restaurant insurance policies can duplicate other types for example non-owned vehicles and hired vehicles can be considered a general liability. Restaurant owners can lower the cost of insurance by examining the policies for any duplications and eliminating any overlap.

How Much Does Restaurant Insurance Programs Cost on Average?

The cost of restaurant policies depends on the policies chosen. Each restaurant has its own unique risks and the value of the restaurant’s property. Insurance costs about $425 per month or a median annual premium of $4,980. The above value eliminates low and high outliers, providing a better representation of typical restaurant insurance costs than the average value.

How Is the Cost of Coverage Determined?

Insurance firms consider numerous factors when calculating insurance premiums. The type of coverage and the amount of coverage are some of the factors that determine the cost.  In terms of cost, comprehensive insurance is expensive. Less coverage on the other hand attracts cheaper premiums compared with more coverage. More coverage attracts higher premiums.

The actuarial tables also affect the cost. Actuaries use statistics and mathematics to predict the likelihood of an insurance claim, based on many of aforementioned criteria. The actuarial table provides the insurance firm’s underwriting department, which utilizes it to set policy premiums.

What Does Restaurant Insurance Cover?

Restaurant liability insurance covers bodily or property damage that you cause to your customers. These claims can occur if your customer slips and falls, get food poisoning, or is burned.

Restaurant property insurance covers the kitchen equipment, building, freezers, dining tables, and other properties.

Who Needs Restaurant Liability Insurance?

This insurance policy is good for restaurant owners because running a restaurant is challenging. Not only do owners worry about service, personnel, food quality and customer experience but also how to run the back office.


For every restaurant, things like customer safety, taxes insurance, profitability, and regulations can take up a substantial amount of time and energy. The above guide provides some of the top insurances that restaurants need, and how insurance costs can be lowered. A good restaurant insurance policy enables businesses to deal with issues as they arise so that owners and managers can focus on running and growing the business.

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