Insurance for Cafes and Coffee Shops
Cafes and coffee shops are an important and relaxing part of the lives of Canadians. We visit cafes and coffee shops to relax, work or study, meet a client, grab a quick bite, or hang out with friends. Many people don’t think that cafes and coffee shops pose any risk, but they do. Think about the equipment used to brew your coffee or make your food, the interior decoration that gives the shops a pleasant atmosphere, or the staff carrying hot beverages and meals around the store. During rush hours, shops can get really hectic. Purchasing insurance for your shop is an important consideration to protect your business against liability and litigation risks.
Why is Insurance for Cafes and Coffee Shops Important?
Although cafes and coffee shops are fun and relaxing for customers to visit, there are still risks that could subject your business to third-party claims and lawsuits. Here are a few examples:
- A server accidentally bumps into a customer and spills a tray of hot coffee, which burns the customer.
- A customer slips on the newly mopped floors and is injured.
- Your coffee and food-making equipment gets damaged during a fire or break-in.
- A customer gets sick after consuming a product sold at your shop.
- One of your delivery trucks or catering vehicles gets into a car accident.
Having insurance for your cafe or coffee shop will protect you when things go wrong and can cover costs of medical expenses, benefits, lost income, repairs, legal defences, etc.
What Does Insurance for Cafes and Coffee Shops Include?
The exact insurance package you purchase depends on your specific business needs, risk management concerns, and budget. However, here’s what you can typically expect to purchase:
Commercial General Liability Insurance – also called CGL insurance, provides coverage for injuries, bodily harms, and property damages occurring to a third party while on your premises. It is especially important because there are always risks of injuries and damage while interacting with customers in the food retail industry.
Commercial Property Insurance – your business relies on your building and equipment to operate successfully. It’s important to ensure both are protected in the event of a fire, vandalism, flood, or other natural accident beyond your control. You can also purchase business interruption insurance for extra coverage in case your business is temporarily forced to close due to an insured peril like a fire, water damage etc..
Employment Practices Liability – protects your business against claims of discrimination, wrongful acts, invasion of privacy, defamation, and more while managing your employees.
Do cafe or coffee shop owners need insurance?
While commercial insurance isn’t required for businesses, any business that serves food or beverages to the public should protect themselves with a comprehensive insurance policy. This includes cafes and coffee shops.
Commercial insurance policies are designed to protect businesses against the various financial and operational risks involved in daily activities. Whether your business suffers a loss from an insured peril or a customer is injured in your shop, coffee shop business insurance can protect you from the costly repercussions of a lawsuit or claim.
For example, if a customer slips or an employee spills hot coffee on them, your coffee shop business insurance policy can help with medical expenses, settlement awards, legal defence fees, and other damages.
Even a seasoned cafe or coffee shop can face unexpected events, so it’s better to have insurance on hand.
How much does business insurance cost for coffee shops and cafes?
The cost of any commercial insurance product depends on certain factors of the business. For small and medium-sized businesses, you can expect to pay around $1500 each year for a coffee shop business insurance policy.
Your insurance price typically depends on how much of a risk you are for the insurance company to insure. The higher your risk as a customer, the most costly your insurance premium will be.
Factors that most insurance companies will take into consideration when evaluating your risk and the best policy options available for your business include:
- Number of years in operation
- Products and services provided
- Location of your cafe or coffee shop
- Annual and projected gross revenue
- Number of employees at your cafe or coffee shop
- Size of your business
Based on these factors, your anticipated annual coffee shop business insurance premium can be more or less than the average amount.
What types of insurance do coffee shops and cafes need?
Coffee shop business insurance contains many coverages that help owners mitigate financial risks. Some types of insurance that are beneficial include:
- Commercial general liability insurance
- Equipment breakdown insurance
- Product liability insurance
- Business interruption insurance
Find the Right Insurance for Cafes and Coffee Shops from ALIGNED
ALIGNED works with Canada’s top insurance companies to provide custom insurance packages at affordable prices. Click Here To Get A Quote or contact one of our business insurance experts for information or with any questions you may have.