How Much Does Restaurant Insurance Cost? 2026 Rates

U.S. restaurants can expect to pay between $3,000 and $6,000 annually for comprehensive business insurance, averaging $250 to $500 per month. The primary cost drivers are employee count, alcohol service, and property value.

How Much Does Restaurant Insurance Cost?

The average restaurant in the U.S. pays between $3,000 and $6,000 per year for a full business insurance package. That breaks down to roughly $250 to $500 per month. However, this is just a ballpark range and actual business insurance costs can vary widely depending on your specific situation.

Every restaurant has its own unique risks and insurance needs, which is why there’s no one-size-fits-all premium. A small café with no employees and no alcohol service will pay far less than a large, full-service restaurant with a liquor license and dozens of employees.

The type of food you serve, your hours of operation, the value of your property, and even your location can influence your premiums.

For example, restaurants in cities with higher crime or lawsuit rates may pay more for liability coverage. Similarly, a place with deep fryers and grills will likely have higher property premiums due to the fire risk, compared to a sandwich shop with minimal cooking equipment.

Understanding these variables can help you better estimate your insurance needs and prepare for the real costs of protecting your restaurant.

Average Restaurant Insurance Costs For Coverage Types

When it comes to protecting your restaurant, different types of insurance cover different risks. Understanding the average cost, coverage details, and what influences pricing for each policy type can help you build a more effective insurance plan. Here’s a closer look at the major coverages most restaurants need.

• General liability insurance: $73 per month
• Business owner’s policy: $180 per month
• Liquor liability insurance: $45 per month
• Workers’ compensation insurance: $150 per month
• Commercial auto insurance: $147 per month
• Commercial property insurance: $150 per month

Business Owner’s Policy (BOP)

A Business Owner’s Policy is a popular option for restaurant owners because it combines general liability coverage with commercial property protection. The average cost for restaurants is about $180 per month.

A BOP can help cover customer injury claims along with damage to the building, furniture, refrigeration units, cooking equipment, and dining room fixtures. If a grease fire damages the kitchen walls or ruins appliances, this type of policy helps pay for repairs and replacements. Some restaurants add upgrades like equipment breakdown protection, food spoilage coverage, or business interruption insurance.

Premiums are influenced by location, property value, crime and weather risks, number of employees, revenue, and selected endorsements.

Average annual premiums in 10 states:

Note: Estimates reflect blended BOP averages for restaurants. Actual pricing varies by limits, endorsements, claims history, and location.

Liquor Liability Insurance

Restaurants that sell or serve alcohol often carry liquor liability insurance. The average cost for restaurants offering alcohol service is about $45 per month.

This coverage protects your business if an intoxicated customer causes injury or property damage after being served at your establishment. A restaurant may be held responsible if a guest overserves at the bar, leaves, and later causes harm to others. Premiums depend on alcohol sales volume, bar operations, the type of beverages served, staff training practices, and past incidents.

Average annual premiums in 10 states:

Note: Estimates reflect average liquor liability rates. Actual premiums vary by alcohol sales, limits, claims history, and location.

General Liability Insurance

General liability insurance is one of the most common policies for restaurant owners, averaging about $73 per month.

This policy protects restaurants from third party injury or property damage claims. If a customer slips on a wet floor, burns their hand on a buffet fixture, or trips over a loose rug, general liability may help cover medical costs and legal expenses. Typical limits are $1 million per occurrence and $2 million aggregate.

Costs depend on foot traffic, restaurant size, location risk, entertainment offerings, and claims history.

Average annual premiums in 10 states:

Note: Estimates reflect averaged liability pricing for restaurants. Actual rates vary by location, limits, safety practices, revenue, and claims history.

Commercial Property Insurance

Commercial property insurance for restaurants averages about $150 per month when purchased separately.

This coverage protects your building and everything in it, including ovens, fryers, refrigerators, POS systems, furniture, and decor. Damage from events like fire, theft, vandalism, or certain storms may be covered. Many restaurant owners choose high limits due to the high cost of commercial kitchen equipment.

Premiums depend on building age, wiring, fire suppression systems, crime levels, replacement cost values, and add ons like food spoilage and equipment breakdown.

Average annual premiums in 10 states:

Note: Estimates reflect market averages for restaurant property policies. Actual pricing varies by limits, building type, location, and loss history.

Workers’ Compensation Insurance

Workers’ compensation coverage for restaurants averages around $150 per month.

Workers’ comp pays for medical costs and lost wages if employees are injured while working. In restaurants, common injuries include knife cuts, slips in the kitchen, burns, lifting strain, and falls. Premiums depend on payroll totals, employee roles, staffing levels, claims history, and workplace safety programs. Most states require coverage for restaurant employers.

Average annual premiums in 10 states:

Note: Estimates reflect workers’ comp averages for restaurants. Actual rates vary by payroll size, job duties, claims history, and safety compliance.

Commercial Auto Insurance

Restaurants that deliver food or operate catering vehicles often need commercial auto insurance. The average cost is about $147 per month.

This policy covers vehicles used for business purposes, including accidents, theft, and liability claims. If a delivery driver causes a collision while transporting meals, commercial auto insurance can help cover damages. Premiums depend on mileage, number of vehicles, employee driving records, and whether personal vehicles are used for deliveries.

Average annual premiums in 10 states:

Note: Estimates reflect averages for restaurant delivery and catering vehicle usage. Actual pricing varies by drivers, mileage, vehicle type, and location.

Restaurant Business Insurance Costs By Provider

Restaurant business insurance costs will vary greatly depending on the insurance carrier. Use the table below to find average costs across different providers.

Note: These estimates are based on average annual premiums observed for restaurant businesses across both small and large agencies and typical coverage mixes (BOP, general liability, property, business interruption, workers’ compensation, liquor/product liability where applicable); actual premiums will vary by location, revenue, size, services offered, claims history, and selected coverage limits

What Factors Impact Your Restaurant Insurance Costs?

Restaurant insurance premiums are carefully calculated by underwriters based on your business’s risk profile. From the food you serve to your location and claims history, several factors influence what you’ll pay for coverage.

Type Of Restaurant

Different restaurant models carry different risks. Full-service restaurants and bars typically pay more than small sandwich shops. Alcohol service especially raises liability risks if intoxicated patrons cause harm.

Alcohol Sales

Serving alcohol directly impacts your premiums. Liquor liability insurance is often mandatory, and businesses with higher alcohol sales usually face higher insurance costs.

Location

Restaurants in high-crime, flood-prone, or urban areas typically pay more for property and liability insurance. Different jurisdictions carry varying regulations too, with some states and local health departments requiring much higher permits and coverage. A low-risk suburban location with fewer claims can lower your premiums.

Size Of Your Operation

More square footage, seating, employees, and revenue all raise the chances of a claim. Workers’ compensation costs also rise with larger staff counts, especially in fast-paced kitchens.

Property Value And Equipment

Expensive cooking appliances, walk-in freezers, and custom furnishings increase your commercial property premiums. If you have large, commercial grade equipment including generators and refrigerators, you may need additional coverage. The same is true of the high-quality chairs and tables a luxury restaurant has over plastic chairs for a small sandwich shop on the beach. Many restaurants add endorsements like equipment breakdown or food spoilage insurance to protect valuable assets.

Claims History

If you’ve filed frequent insurance claims, underwriters will see you as higher risk, leading to higher rates. For example, having a history of claims for foodborne illness–even allegations of contaminated food–can increase your liability and restaurant insurance costs. A clean claims record can qualify you for discounts.

Policy Limits And Deductibles:

Higher policy limits mean better protection but come with a higher premium. Choosing a larger deductible can lower your monthly costs but raises your out-of-pocket risk when claims occur.

Optional Endorsements

Add-ons like business interruption, cyber liability, and hired and non-owned auto coverage tailor protection but increase your premium. They are essential for restaurants with delivery, online ordering, or high perishable inventories.

Insurance Provider

Rates vary among insurers. Some specialize in hospitality risks and offer better pricing or more flexible options. Comparing quotes from multiple carriers can save you money.