Why Do Bakeries Need Insurance?
Bakeries are known for their homemade treats and welcoming aromas that fill the air. Whether customers come to you for their wedding or birthday cakes, brunch spread, or a quick snack on the road, you add happiness to their day. Working in the food business also brings risks that can turn happy moments into unhappy ones. Baker insurance protects your bakery from these risks and the lawsuits that often follow.
Companies categorized under this industry are primarily involved in the retail of bread and other bakery products.
Risks Bakeries Could Face
Bakers often face these risks:
- Food Poisoning: Working with eggs, fruits, and milk is risky. If any of these ingredients spoil and make customers sick, they can file a lawsuit. The rise of food allergies is also important to consider. If you fail to maintain a clean baking environment and nuts are cross-contaminated, your baked goods can cause serious illness and even death.
- Failure to Deliver: As a baker, you know delivering what you promise on time is crucial to your customer’s event or party. Sometimes employees fail to show up, a wrong ingredient is used, or a cake falls on the floor delaying your completed masterpiece. Failing to deliver leaves the door open for lawsuits from unhappy customers.
- Employee Injury: Bakers use tools including knives that can cause significant injury. If an employee cuts themselves and requires medical attention, you are responsible for the bill.
- Auto Accidents: If you cause an accident while delivering a wedding cake, your business is responsible for any damages.
- Food Spoilage: Refrigeration systems are valuable when they work. But, when one breaks without your knowledge and thousands of dollars of food are spoiled, it is an unexpected expense you can’t usually afford.
Types of Coverage Bakeries Need
Bakery insurance protects your business, reputation, and financial means in the event of a lawsuit or unpleasant scenario. Every bakery needs general liability and commercial property insurance. If you have employees, you need worker’s compensation, and if you offer delivery, you need commercial auto insurance.
- General Liability: Pays to defend your business when a lawsuit is filed alleging injury or property damage. It also covers the costs of medical expenses and property repair or replacement.
- Commercial Property: Protects from catastrophic events like fires and explosions by covering costs to repair or rebuild your building or business equipment. Many companies let you add business interruption insurance to help you pay your normal expenses like rent and payroll while you are shut down.
- Business Auto: Covers damage to your business vehicle in the event of an accident in addition to damages to a third party’s property that you are liable for. It is also important to add hired and non-owned auto if you or your employees use personal vehicles for business errands.
- Product Liability: This policy is like food insurance and protects your business when a lawsuit is filed alleging your bakery items caused sickness.
- Professional Liability: Pays costs for lawsuits that are filed when your bakery doesn’t deliver goods as promised. It also covers you when special orders like allergy requests are overlooked and cause a severe allergic reaction.
- Equipment Breakdown: Replacing broken equipment like refrigerator systems is expensive. This policy pays for repairs or replacements of bigger equipment. In addition it covers other costs associated with it like food spoilage.
How Much Does Bakery Insurance Cost?
Baker insurance costs vary depending on the carrier you choose. Most insurance companies review your claim history, qualifications, health inspections, and whether you offer delivery to calculate your bakery insurance costs. You can request a baker insurance quote today by completing the form below.