Commercial insurance for restaurants: the complete guide

Restaurants are one of the most complex commercial insurance accounts an agent can write. They combine property, liability, food spoilage, liquor service, worker injury risk, and food contamination exposures in a single business. Understanding the full coverage picture — and knowing what questions to ask — is essential for writing restaurant accounts well.

The restaurant insurance stack

A complete restaurant program typically includes:

• Commercial general liability — covers slip-and-fall injuries to customers, food-borne illness claims, and property damage to third parties. The standard starting point for any restaurant.
• Liquor liability — if the restaurant serves alcohol, this is required. The GL policy excludes liquor liability for businesses in the business of alcohol service. See our guide to liquor liability insurance for details.
• Commercial property — covers the building (if owned), kitchen equipment, furniture, fixtures, and inventory. Restaurants have significant equipment value — commercial ranges, walk-in coolers, refrigeration systems.
• Business income / extra expense — a kitchen fire that shuts down operations for three months can be financially catastrophic. Business income coverage replaces lost revenue during the restoration period.
• Workers compensation — restaurant workers face significant injury risk: burns, cuts, slip-and-falls in wet kitchens. Workers comp is required in most states and typically mandatory for restaurant employees.
• Food contamination / food spoilage — covers spoiled inventory after a power outage or equipment failure, and can include coverage for the cost of a health department investigation and notification after a foodborne illness outbreak.
• Employment practices liability (EPLI) — restaurants are one of the highest-risk industries for EPLI claims: wage-and-hour disputes, tip pool allegations, and sexual harassment claims in service environments. See EPLI coverage for details.

Restaurant underwriting — key questions

Underwriters want to understand the nature and scale of the restaurant operation. The most important intake questions for a restaurant account:

• Total annual gross sales (food and beverage separately)
• Percentage of sales from alcohol — the critical liquor liability factor
• Hours of operation, particularly whether they serve past midnight
• Seating capacity and dining area square footage
• Type of cuisine and cooking methods (deep frying is a higher fire risk)
• Any delivery drivers (creates commercial auto exposure)
• Entertainment (live music, DJ) — increases liability exposure significantly
• Number of employees and any seasonal staffing patterns
• Kitchen suppression system — last inspection date
• Any prior food contamination incidents or health department violations

Restaurant-specific property considerations

Restaurant property is more complex than a simple "building and contents" approach. Consider:

• Leasehold improvements — many restaurants are in leased space with significant tenant improvements. These may or may not be covered under the landlord's policy — the lease should specify who insures what.
• Refrigeration equipment breakdown — commercial refrigeration systems are expensive to repair and replace. Equipment breakdown coverage (often available as an endorsement) covers mechanical breakdown of covered equipment.
• Utility service interruption — a power outage caused by a utility problem can cause significant food spoilage. Some policies cover utility service interruption; others exclude it.

Restaurant insurance markets

Most standard carriers write restaurants, but appetite varies significantly by operation type. Bars and nightclubs (where alcohol exceeds 50–75% of sales) are often forced into admitted specialty markets or E&S. Restaurants with entertainment (live music, dance floors) are more restricted. Standard market carriers generally prefer restaurants where food is the primary product and alcohol is secondary.

For more straightforward restaurant accounts — a family dining restaurant with modest alcohol sales and no entertainment — a BOP with a liquor liability endorsement from a hospitality-focused carrier is often the most efficient approach. See our guide to BOP policies for how the package works.

Delivery and catering exposure

Restaurants that add delivery (whether through their own drivers or platforms like DoorDash) or off-premises catering are adding coverages they may not have purchased. Their own drivers need commercial auto coverage — personal auto policies exclude business delivery use. Platforms like DoorDash provide some coverage for gig drivers, but the restaurant itself may still have exposure during handoff. If a restaurant does significant catering, the catering operations may be excluded from the base GL policy and need a separate endorsement or policy.

Restaurant intake built for commercial agents

AgencyAssist's intake captures alcohol percentage, seating, entertainment, delivery operations, and kitchen systems — everything needed to write a complete restaurant account.