Insurance for food trucks
Food trucks have grown increasingly popular in Canada over the past few years. Long gone are the days when you could only find a hot dog or a burger from a food stall – more recently, food vendors serve every cuisine around the globe. There are even food truck festivals, giving vendors the limelight rather than simply being at an event out of necessity.
Whether you’re new to the food truck industry or you’ve owned a food truck for years, insurance is a must-have to ensure you’re protected from the business-related risks you could face. Even the most vigilant, health-and-safety-focused food vendors can be held liable for such things as damage to a third party’s property or an allergic reaction claim due to a mislabeled ingredient.
You’re in safe hands when you make a quote with Zensurance. More than 100,000 entrepreneurs have trusted us to protect their businesses with insurance policies explicitly designed to cover their needs.
What is food truck insurance?
Food truck insurance is a policy package designed specifically for food truck owners. It’s built to protect businesses against the specific liabilities of serving food and drink and the insurable risks of operating a food truck.
What does food truck insurance cover?
Food truck insurance combines several coverages to provide comprehensive protection for your food truck business. Typically, food truck insurance will include the following coverages:
- Commercial General Liability (CGL) Insurance: CGL protects you from the day-to-day risks of running a business if you’re liable for a third party’s bodily injury or property damage. For example, a customer banged their head on your serving hatch and needed stitches. Your CGL policy could cover the cost of their medical bills.
- Product Liability Insurance: Product liability coverage can be included in a CGL policy. This coverage protects you against allegations of property damage or bodily injury caused by a product you manufacture, distribute, or sell – this includes the food and drinks you serve. For example, if a customer complains of food poisoning after eating your food, their medical costs and your legal fees could be covered by product liability insurance.
- Commercial Property Insurance: Commercial property insurance provides financial protection for your business premises (aka food truck) and its assets from insured risks that occur beyond your control – for example, a fire, theft, and specific severe weather events. For example, say your food truck is caught in a windstorm and its exterior is damaged by flying debris. Commercial property insurance could cover the costs to repair the damage.
- Business Interruption Insurance: Commercial property insurance often includes business interruption coverage. This coverage provides financial reimbursement for lost income after an insured event. Say the windstorm example from above caused your food truck to need to be sent for repairs for a week, meaning you’ve lost a weeks’ worth of income. Business interruption insurance could cover the estimated lost revenue. Be advised business interruption coverage doesn’t cover the income lost due to a pandemic, infectious disease, or government-mandated closures.
- Equipment Breakdown Insurance: As a food truck owner, you use professional equipment such as commercial appliances. Equipment breakdown insurance can cover the costs of repairing or replacing broken-down professional equipment or equipment that’s damaged due to mechanical failure or electrical issues. This policy can also provide financial coverage for the lost revenue and food spoilage directly related to the breakdown. Suppose you’re an ice cream vendor, and your commercial freezer breaks down on a hot day – equipment breakdown insurance could cover the repair costs and the estimated lost revenue.
- Legal Expense Insurance: Legal expense insurance provides financial coverage to offset the costs of hiring a lawyer for events where legal support isn’t typically covered by other policies (e.g. property protection, bodily injury to yourself or an employee). This coverage provides free access to legal advice and the financial support to retain a lawyer if needed.
Do food trucks need insurance?
Yes, if you serve or sell food or drink, it’s imperative to protect your business with a tailored insurance policy. Food truck insurance is recommended for any food truck or food trailer owner, or business owner with a portfolio of food trucks.
- Food vendors
- Food truck owners
- Drink stall vendors
- Ice cream van owners
- Hot dog stand owners
How much does it cost?
Every business is unique, so there’s no set cost of a food truck insurance policy. For example, the insurance for a small food vendor can anticipate anywhere from $500-$1,000 per year with a commercial general liability policy with a limit of $2 million.
When determining policy options that are right for your business, you can expect the following factors to be taken into consideration:
- Years of experience
- Locations served
- The type of vehicle or vehicles you have
- Annual and projected gross revenue
- Number of employees
- Previous insurance claims
Common claims scenarios