Cottage food insurance

Cottage food insurance protects small business owners who make beverages or food products in their homes to sell to the public.

With cottage food insurance, you can receive coverage for:

• General liability coverage, including product liability insurance
• Cyber insurance
• Tools and equipment insurance, also called inland marine insurance
• Professional liability insurance, also known as errors and omissions (E&O) insurance

The above types of insurance for home-based food businesses can help cover the costs of several types of claims that can arise from making and selling food, including:

• Allergic reactions
• Food contamination and food poisoning
• Third-party bodily injuries or property damage
• Missing or damaged supplies
• Damaged rental property

This insurance policy can help safeguard your business against third-party claims, as well as help you meet requirements to sell at events, markets, or local shops.

Anyone who makes and sells shelf-stable food and beverages from their home should carry cottage food insurance to protect their business. Whether you make baked goods, artisanal drinks, jams and jellies, or sauces, cottage food insurance is a must.

Say a home baker makes several dozen fresh cookies to sell at the local farmers market. Later on they discover the cookies caused a customer to have an allergic reaction due to traces of peanuts within them. Because the labels on homemade cookies didn't disclose potential allergens, the customer sues the home bakery business. Cottage food operations insurance would help cover the potentially devastating financial and legal liabilities of this claim.

Without food business insurance, your home kitchen is liable to pay for lawsuits and claims out of pocket because renter's or homeowner's insurance doesn't cover work-related incidents and liabilities.

It depends on your state laws and regulations for what you need in order to sell baked goods from your home. In most cases, you'll likely be required to have the necessary licenses and permits, such as a business license, catering license, or food handlers card.

Culinary entrepreneurs also need to comply with all local health department regulations and inspections, which can vary depending on where you live.

Additionally, a cottage food permit may be required in some states for home-based food businesses. A permit will determine which products you can make, like cakes and cookies, and where they can be sold. Certain foods are usually prohibited to protect consumers from potential foodborne illnesses.

Even if not required, like in California, Colorado, and Florida, you must still follow the cottage food laws in your state.

It’s easy to find insurance for home-based food businesses with Insureon. Whether you run a small baking business, are a food vendor, or operate a food truck, you’ll need to provide some basic information about your company.

Our application will ask you for your annual revenue and payroll, among other details. You can buy a policy online and get a certificate of insurance (COI) that verifies your insurance coverage in three easy steps:

1. Complete our free online application.
2. Compare free quotes and choose a policy.
3. Pay for your policy and download a certificate for proof of insurance.

Insureon's licensed insurance agents work with top-rated U.S. insurance providers to find the right insurance plan for your food business, whether you work independently or have several employees.

For home bakers that operate short-term rentals or Airbnbs, you can find coverage through our partner, Proper Insurance.