How much does business insurance cost for coffee shops and cafes?
Top business insurance policies for coffee shops and their cost
Here are a few types of business insurance policies purchased by coffee shops and cafes, along with their average monthly costs:
- Business owner's policy (BOP): $126 per month
- General liability insurance: $82 per month
- Workers' compensation insurance: $88 per month
- Liquor liability insurance: $64 per month
- Commercial auto insurance: $222 per month
- Cyber insurance: $129 per month
Our figures are sourced from the median cost of policies purchased by Insureon coffee shop customers. The median offers a better estimate of what your business is likely to pay because it excludes outlier high and low premiums.
Business owner’s policy
Coffee shop and cafe owners pay an average of $126 per month, or $1,507 annually, for a business owner’s policy (BOP).
A BOP bundles general liability insurance with property insurance, usually at a discounted rate. This insurance package often includes insurance endorsements, such as business interruption insurance (also called business income insurance) or equipment breakdown coverage.
Equipment breakdown coverage is especially valuable for coffee shops because standard commercial property insurance typically excludes mechanical and electrical failure. This is the most common way espresso machines, grinders, and refrigeration units break down, and commercial equipment can be costly to repair or replace.
This is the average policy for coffee shops that buy from Insureon:
Insurance premium: $126
Policy limit: $1 million per occurrence, $2 million aggregate
Deductible: $1,000
The cost of a business owner's policy is determined by your cafe's location, operations, and value of business property. Coffee shops with high-value equipment and furnishings tend to pay higher premiums.
Not all cafes qualify for a business owner’s policy. Check with your Insureon agent to find out if your coffee shop is eligible.
General liability insurance
Coffee shops and cafes pay an average premium of about $82 per month, or $979 annually, for general liability insurance. This policy protects cafes against customer bodily injuries and customer property damage, along with advertising injuries.
Insureon’s licensed agents typically recommend purchasing a business owner’s policy, which bundles general liability insurance with commercial property insurance at a discounted rate. A BOP protects your own business property and covers common business risks, like customer injuries.
This is the average policy for coffee shops that buy from Insureon:
Insurance premium: $82 per month
Policy limit: $1 million per occurrence, $2 million aggregate
Learn more about how your insurance premium is calculated and how to save money on your general liability coverage.
Workers’ compensation insurance
The average cost of workers’ compensation insurance for a cafe is about $88 per month, or $1,059 annually. The cost of a policy varies significantly depending on the state and your business operations.
Workers’ compensation insurance is required in almost every state for coffee shops with employees. This coverage helps pay medical bills and lost income for baristas and other employees who are injured on the job. Most policies include employer’s liability insurance, which protects cafe and coffee shop owners against lawsuits and legal expenses related to employee injuries.
Because health insurance plans can deny claims for workplace injuries, workers' compensation coverage is also recommended for sole proprietors.
The cost of workers' comp depends on several factors, primarily the size of your staff and their occupational risks. You can save money on workers' comp coverage by classifying your workers correctly and implementing a risk management plan to minimize work-related injuries.
Liquor liability insurance
Liquor liability insurance is an important policy to consider for coffee shops and cafes that plan to sell alcohol. The average liquor liability insurance cost for food and beverage businesses, including coffee shops, is $64 per month, or $769 annually.
This type of insurance protects cafes from liability related to serving alcohol. In some jurisdictions, your coffee shop might need liquor liability coverage in order to obtain a liquor license.
This is the average policy for coffee shops that buy from Insureon:
Insurance premium: $64 per month
Policy limit: $1 million per occurrence, $2 million aggregate
What's more, many states have dram shop laws that hold a business liable for any damages caused by intoxicated customers who were served by your staff, which can make this coverage all the more important to protect businesses against expensive legal fees and other financial losses from an incident.
Learn how to save money on your policy, which coverage options to choose, and how liquor liability costs are calculated.
Commercial auto insurance
The average cost of commercial auto insurance for cafes and other food and beverage businesses is about $222 per month, or $2,669 annually.
This insurance covers medical expenses related to injuries and property damage costs if someone driving your coffee shop vehicle is held liable for an accident. It also covers vehicle theft, vandalism, and damage caused by weather.
Most states require this type of insurance for vehicles owned by your cafe business. For personal, rented, and leased vehicles used for work purposes, look to hired and non-owned auto insurance (HNOA) instead.
The cost of commercial car insurance depends on several factors, including the policy limits you choose, any additional coverages, property and liability claims history, the number and value of your vehicles, and the driving records of anyone permitted to drive. Learn how insurers calculate your premium and how to save money on commercial auto coverage.
Cyber insurance
Small businesses pay an average of $129 per month, or $1,552 annually, for cyber insurance. You might also see this policy called cyber liability insurance or cybersecurity insurance.
Cyber insurance helps cafes recover financially after a data breach or cyberattack. It can help pay for customer notification costs, fraud monitoring services, and other costs necessitated by state data breach laws.
The cost of cyber insurance depends on the amount of personal information handled by your coffee shop, such as customer credit card numbers, along with the number of employees who can access that information.
How are cafe insurance costs calculated?
Coffee shop and cafe insurance coverage costs are determined by several factors. While underwriting your policy, insurance companies will consider the following when calculating insurance rates:
- The types of food and beverages served: Coffee shops may see elevated premiums if they offer higher-risk products or services, such as bar service or hot food, compared to cafes that only serve coffee.
- Business property and coffee shop equipment: Coffee shops that work with higher-value coffee-making equipment are likely to see higher premiums. Also, any equipment that is frequently used could cost more to insure than items that are used less often.
- Location: If your cafe operates in an area that is more prone to natural disasters, increased foot traffic, or high crime rates, you may have to pay higher insurance costs than a shop located in an area where these factors are less present.
- Number of employees: If your coffee shop has several employees on staff, you could see increased insurance costs, as there are more opportunities for accidents to happen or for potential damage to occur to a customer's property.
- Business size and revenue: Insurance companies may assume a cafe that is making more money will also face increased customer exposure, which can generate higher premiums.
- Coverage limits and deductibles: Coffee shops with higher coverage limits and lower deductibles on their insurance policies will typically see their premium costs increase, while lower limits and a higher deductible can help keep their rates lower.
- Type of business operation: A self-employed business owner serving coffee from a small walk-in counter may not have to pay as much for insurance as a larger coffee shop with multiple employees.
- Types of insurance coverage purchased: Some policies are required for cafes to obtain licensing or certifications. These required policies often are needed to cover more expensive accidents and lawsuits, and tend to cost more than basic coverages.
- Claims history: A coffee shop business owner with a lengthy list of previous insurance claims will likely pay more for insurance than a cafe with no claims history.
How do I get coffee shop business insurance?
Insureon can help cafes, banquet halls, bakeries, cake and cookie bakers, juice bars, and other food businesses find affordable insurance coverage, whether you work independently or hire employees.
To get started, all you need is your business information on hand. Our insurance application will ask for basic facts about your business, such as revenue and number of employees. Then, you can buy a policy online with Insureon in three easy steps:
- Fill out a free online application with details about your business.
- Compare custom quotes from top-rated U.S. insurance companies.
- Select a policy and pay the premium to begin coverage.
Our licensed insurance agents are available to answer questions about your coffee shop insurance costs, state insurance requirements, and the best types of coverage for your specific business needs.
Once you've bought the cafe insurance policies you need, you can download a certificate of insurance (COI) for proof of coverage. Most small business owners can get insured within 24 hours of applying for free quotes.
What our customers are saying
The average costs on this page were derived from our data on small business owners in the cafe and coffee shop field who purchased policies through Insureon. Most of our customers have less than five employees, annual revenue ranging from around $50,000 to more than $200,000, and five years or less in business.
Find insurance quotes for coffee shops
Want free expert advice right in your inbox?
By entering your email address and subscribing, you agree to our Terms of Use and Privacy Policy