Food trucks are vulnerable to numerous risks, such as: 

• Vehicle risks
• Operator risks
• Liability risks
• Food spoilage and fire hazard risks

In this article

Who Needs Food Truck Insurance?

Food truck insurance is a must for all businesses who have ventured to a mobile way of providing their services. Businesses that generally need food truck liability insurance are:    

• Lunch trucks   
• Catering trucks  
• Vending trucks   
• Ice cream trucks   
• Concession trucks   
• Mobile food trucks 

What Policies Cover Food Truck Insurance?

Business Owners Policy

A business owners policy (BOP) combines commercial property, business interruption insurance, as well as general liability insurance into one plan. The combination of the three allows a BOP to cover different claims against liabilities such as property damage, customer injuries, theft, and vandalism. A BOP is often more affordable than buying each policy separately.

Workers Compensation Insurance

Workers compensation insurance covers employee claims for injuries and illnesses due to their job, such as lost wages and medical bills. Except for Texas, this policy is made mandatory coverage in all states.

When it comes to the food industry, tiny mishaps are unavoidable. In a rush to serve a dish, a hot pot tumbles and consequently burns your employee’s leg. Your workers compensation insurance will kick in and help cover their medical bills.

Commercial Auto Insurance

Commercial auto insurance makes sure to cover the medical bills, cost of property damage, and possible lawsuits caused during an accident. This policy is a necessity for businesses that own a vehicle.

According to a survey by Mobile Cuisine, over 80% of food truck customers stated that they liked eating at food trucks because the experience was new, exciting, unique, and different. As much as food truck businesses have stylized the food industry, it has also increased the chances of accidents on the road. For instance, food trucks account for 280,000 accidents every year. When your business model itself is based on a vehicle, commercial auto policy is a must-have.

Commercial Property Insurance

Commercial property insurance helps cover losses generally incurred by your business’s assets. Damage to your costly kitchen equipment could consequently derail your business. As a food truck owner, you need commercial property insurance to protect your investment in the equipment that obviously runs your business.

Commercial General Liability Insurance

Commercial general liability insurance (CGL) serves to cover either property damage or bodily injury claims that arise from accidents.

In a famous lawsuit, an elderly woman sued McDonald’s in 1992 after spilling hot coffee on herself. The coffee was so hot, it caused third-degree burns and she needed numerous surgeries. As a restauranteur, if you want to avoid covering for such third-party claims out of your pocket, you need to opt for a CGL policy. You can add cyber liability insurance as an endorsement to your CGL policy to protect your customers’ sensitive information, such as credit card information.

Commercial Umbrella Insurance

Commercial umbrella insurance offers to provide extra limits or extends liability coverages when the primary liability policies such as commercial auto, commercial property, and general liability fail to fully cover against third-party claims.

For example, the compartment sink in your food truck falls off, destroying all your perishable stock and other valuables in your truck. When your commercial property insurance isn’t enough to cover the amount of the property damage, your umbrella policy swoops in to clean up the remaining cost incurred.

Product Liability Insurance

Product liability insurance helps cover costs for illnesses, property damages, as well as injuries caused by defective products sold by a business. This policy applies to all businesses that either manufacture or sell products. Heinz was fined with a $2.25 million lawsuit for a misleading marketing campaign. Their toddler snacks were marketed as healthy and made of fruit and vegetables when in reality it was a sugar-laden product.

How Much Does Food Truck Insurance Cost?

The Food Truck Nation report claims that the food truck industry earns around $2 billion in revenue every year. Food truck insurance considers several factors in determining the premium. These include: 

1. Risks of the food truck
2. Value of business equipment and property
3. Services offered by the food truck
4. Revenue of business
5. Location of business
6. Number of employees and payroll
7. Policies coverage amount
8. Deductibles

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