Restaurant Insurance
Bay Area restaurants face risks that generic business policies don’t cover — spoilage, equipment breakdown, liquor liability. We place restaurant-specific BOPs with carriers who actually understand food service, from your walk-in cooler to your liquor license.
Your Walk-In Fails Saturday Night. Are You Covered?
Walk-in cooler compressor fails on a Saturday night. Owner doesn’t realize until Sunday morning when they come in to prep. Everything inside — meat, seafood, produce, dairy, prepped sauces — is ruined. Thousands of dollars in food loss, gone overnight.
Here’s what most restaurant owners don’t realize: a standard Business Owner’s Policy often excludes or severely limits spoilage coverage. If your policy doesn’t have a specific spoilage endorsement, that loss comes out of your pocket.
The fix? A restaurant-specific BOP from a carrier who understands food service — with spoilage coverage built in or available as an inexpensive add-on. We’re talking a couple hundred dollars a year for coverage that can pay for itself many times over in a single event.
That’s the difference between a generic business policy and one actually designed for restaurants.
Food Service Businesses We Cover
Whether you’re a 20-seat neighborhood spot or a multi-location operation, we match you with carriers built for food service.
What Restaurant Insurance Actually Includes
Business Owner’s Policy (BOP)
Packages your core coverages: property (building, equipment, inventory, improvements), general liability, and business income. The key? Get a restaurant-specific BOP — not a generic small business policy with add-ons stapled on. The difference matters when it’s time to file a claim.
Spoilage Coverage
Covers food loss from power outages, equipment failure, contamination, and mechanical breakdown. Walk through your coolers and freezers on a busy day, add up the replacement cost of everything in there — that’s your spoilage exposure. This coverage typically costs a couple hundred dollars a year and can pay for itself many times over in a single event.
Equipment Breakdown
Your commercial kitchen equipment is expensive and critical. When a hood system fails and the health department says you can’t operate — that’s repair cost, lost revenue, and rush service fees all at once. Equipment breakdown coverage handles it. Usually a few hundred dollars a year.
Business Income & Extra Expense
If you close due to a covered loss, this covers lost revenue, continuing expenses (rent, payroll, loan payments), and extra expenses to reopen faster. Peninsula/SF rents are steep — if you’re closed for months and still paying rent, this coverage is the difference between surviving and shutting down. We recommend 18-24 months, not 12.
Liquor Liability
If you serve alcohol, your GL policy excludes liquor-related claims. You need a separate liquor liability endorsement. California dram shop law means if you over-serve someone and they cause harm, you can be held liable. $1M minimum.
Workers Compensation
Required if you have employees. Restaurant employees are high-risk — kitchen burns, cuts, slips, strains. Several of our preferred carriers offer pay-as-you-go workers comp which helps with the cash flow swings of variable-hours staffing.
Cyber Liability
Your POS system stores customer credit card data. A breach means notification costs, legal fees, PCI fines, and business interruption. For a restaurant running everything through a POS system, this is increasingly essential coverage.
EPLI (Employment Practices Liability)
Covers wrongful termination, discrimination, harassment, and wage disputes. High employee turnover, diverse workforce, tipped employees — restaurants are particularly exposed to these claims.
Why Bay Area Restaurant Insurance Is Different
Sky-high rents
If you’re closed for months and still paying steep monthly rent, business income coverage is the difference between surviving and shutting down permanently. 18-24 months coverage, not 12.
Competitive labor market
Good cooks and servers are expensive. Higher payroll means higher workers comp premium. If you close temporarily, keeping key staff paid is critical — business income coverage helps here too.
Strict permitting
SF Health Department is strict. Reopening after a fire or major damage requires permits, inspections, approvals. Reopening takes longer here than almost anywhere = need longer business income period.
Liquor license value
SF liquor licenses are worth significant money on the secondary market. Make sure your property policy accounts for the license value if the business is destroyed.
Earthquake risk: Standard BOP excludes earthquake. It’s expensive but available. Worth at least getting a quote.
Paul’s Take
“Restaurant insurance isn’t complicated, but it matters. I’ve seen spoilage claims pay for decades of premium in one shot. I’ve seen kitchen fires shut down operations for months because the owner didn’t have enough business income coverage to ride it out. The restaurants that survive the bad days are the ones who invested in the right coverage on the good days. Get a restaurant-specific BOP with spoilage and equipment breakdown. Get adequate business income coverage. If you serve alcohol, get liquor liability. Cover your workers properly. That’s the checklist.”
— Paul Nadler, Principal
The 6 Most Expensive Restaurant Insurance Mistakes
No spoilage coverage
A standard BOP often excludes or limits it. One cooler failure costs thousands. Spoilage coverage costs a couple hundred dollars a year. The math is obvious.
12 months business income in the Bay Area
Permitting, contractor availability, and supply chain delays mean reopening takes longer here. 18-24 months is the right number when you’re paying steep monthly rent.
Skipping liquor liability
Your GL policy excludes alcohol-related claims. One over-served customer causes a DUI accident and you’re facing a serious lawsuit with no coverage.
Underinsuring equipment
A commercial hood system alone can cost tens of thousands to replace. Walk through your kitchen and add up replacement cost for everything. That’s your number.
No cyber coverage
Your POS system processes credit card transactions daily. A breach means notification costs, PCI fines, and lawsuits. Cheap coverage for an increasingly common risk.
Ignoring EPLI
High turnover, tipped employees, diverse workforce — restaurants are prime targets for employment-related claims. One wrongful termination lawsuit can get expensive fast.
Get the Restaurant Insurance Essentials Guide — Free
We’re finalizing a guide built specifically for Bay Area restaurant owners — BOP essentials, spoilage coverage, equipment breakdown, business income, liquor liability, workers comp, and SF/Peninsula-specific factors. Written by Paul & Zach Nadler. Drop your email and we’ll send it as soon as it’s ready.
Your Walk-In Cooler Doesn’t Wait Until Monday. Neither Do We.
Kitchen fires, equipment failures, spoilage events — they happen on Saturday night, not during business hours. We place you with carriers that offer 24/7 claims service and restaurant-specific coverage that a generic business policy doesn’t include.