Restaurant insurance

A straightforward guide for UK restaurants

Restaurant insurance is a package of policies that protect your team, customers, premises, stock, and cash flow when things go wrong. In the UK, some cover is compulsory if you employ staff, and other elements are strongly recommended because the risks are common in hospitality. The goal is practical protection that keeps you legally compliant and financially stable, not a bundle of extras you do not need.

At a minimum, most restaurants consider Employers’ Liability for staff injuries, Public Liability for customer accidents, and Product Liability for food-related claims. Many add Business Interruption, Property and Contents, Stock, Cyber, and Legal Expenses. Together, these policies help you manage the impact of incidents like slips, burns, fire, flood, data breaches, or supply chain disruption.

Premiums vary widely. A small site might pay from around £500 a year, while larger city venues can pay several thousand. Some tailored packages start from roughly £2.38 per day, but what matters is how well the cover fits your specific risks and limits. Since 2021, premiums have risen sharply across the sector, so strong risk management and accurate sums insured are essential to keep costs workable.

Insurance can offer real financial protection when you understand what is covered - and where the gaps are.

This guide walks through what restaurant insurance typically covers, the key decisions you will face, and how to compare policies safely. We will keep the language clear, set realistic expectations, and point out where exclusions or limits often apply so you can choose with confidence.

What is covered and how claims usually unfold

Core policies focus on third-party injury and damage, staff injury, and harm arising from the food you serve. Employers’ Liability is a legal requirement if you employ anyone, even part time or temporary. Public Liability handles claims from customers or visitors who are injured or have their property damaged. Product Liability addresses illness or injury linked to food or drink you provide. These usually cover legal defence costs and any damages you are liable to pay, up to the policy limit.

Property and Contents cover the building, fixtures, fittings, and equipment against perils like fire, flood, storm, or theft. Stock insurance protects ingredients and chilled goods, often with specific limits and conditions for refrigeration failure. Business Interruption aims to replace lost income after an insured event closes or restricts your operations. Food Contamination cover can help with closure, disposal costs, and reputational recovery after a hygiene incident.

Cyber insurance tackles data breaches, ransomware, and system outages that interrupt online orders or bookings. Legal Expenses can fund professional advice or defence for employment disputes, licensing issues, or HMRC enquiries. Claims typically require prompt notification, evidence such as CCTV or temperature logs, invoices for repairs, and cooperation with appointed loss adjusters. Exclusions commonly include wear and tear, poor maintenance, deliberate acts, and loss outside defined territorial limits. If sums insured are too low, proportional settlement may apply, so accurate valuations matter.

Who benefits most - and who might not

Restaurant insurance is built for UK food businesses of all sizes, from independent bistros and takeaways to multi-site operators. It is especially important if you employ staff, serve alcohol, operate late, rely on chilled stock, or accept online orders and payments. Urban locations with higher crime or flood exposure can see more incidents, making robust cover sensible.

If you operate a pop-up for a short period or run a small home-based supper club with limited guests, you may still need liability cover, but full restaurant packages could be disproportionate. Where a landlord insures the building, you might only need contents, stock, and liability cover. The aim is appropriate protection - nothing excessive, nothing missing.

Picking your protection level

1. Essential level - compliance first

   • Employers’ Liability for all staff.
   • Public Liability at a basic limit, typically £2 million.
   • Product Liability aligned to your menu risk. Suits small venues seeking legal compliance and core protection.

2. Standard level - property and income safeguarded

   • Everything in Essential, plus Buildings or Tenants’ Improvements, Contents, and Stock.
   • Business Interruption with an appropriate indemnity period, often 12 to 24 months.
   • Ideal for owner-operators who cannot afford prolonged downtime after a fire or flood.

3. Comprehensive level - broader risks addressed

   • All Standard covers, with higher liability limits where footfall is high.
   • Food Contamination and Deterioration of Stock extensions.
   • Cyber insurance for online orders, card data, and booking systems.
   • Legal Expenses for licensing and employment disputes.

4. Optional add-ons - tailor to your operations

   • Goods in Transit for deliveries or catering jobs.
   • Loss of Licence where alcohol sales are critical.
   • Equipment Breakdown for fridges, freezers, and cooking equipment.
   • Professional Indemnity if you provide consultancy, events planning, or training - terms have improved in 2025 with broader cover available.

Choose limits based on realistic worst-case costs - not wishful thinking.

What it costs - and what shapes the price

Typical costs vary by venue size, location, and risk controls. UK restaurants may pay from around £500 to £4,000+ annually. Some small-business packages start near £2.38 per day. Use the table to understand drivers, not as a price guarantee.

Who can apply and what insurers check

Most UK restaurants, cafés, and takeaways can apply, including tenants and owner-occupiers. Insurers usually ask for your legal status, address history, trading activities, opening hours, staffing levels, health and safety procedures, fire and security protections, and recent claims. They will want estimated turnover, wage roll, and accurate sums insured for buildings, contents, and stock. For alcohol sales or late-night refreshment, licensing details help underwriters price the risk correctly.

Applications may be declined where there is a history of frequent claims, inadequate fire or security measures, poor hygiene ratings, non-compliance with licensing, or inaccurate disclosures. If you trade in a high flood zone without mitigation, expect additional conditions or higher premiums. Clear records, staff training, and documented risk assessments support better terms.

From quote to claim - the simple steps

1. Gather turnover, wage roll, sums insured, and risk controls evidence.
2. Request quotes early and disclose activities, hours, and prior claims.
3. Compare limits, exclusions, excesses, and indemnity periods carefully.
4. Choose cover levels that match realistic worst-case costs.
5. Bind the policy, then file schedules and certificates securely on site.
6. If an incident occurs, notify the insurer promptly and preserve evidence.

The upsides and the trade-offs

A balanced view helps you decide.

Key checks before you commit

Before buying, confirm your liability limits, property sums insured, and Business Interruption indemnity period. Review all exclusions and conditions that affect food hygiene, temperature logging, security standards, and alarm requirements. Note any excesses per section, plus higher excesses for escape of water or flood. Ask about average clause application for partial underinsurance. Check renewal terms because inflation can push costs higher year on year. Keep copies of policy wording, endorsements, certificates, and proof of risk controls in one place for audits and claims.

Related options that might suit your setup

1. Public Liability only - Useful for small pop-ups or market traders without premises.
2. Home business insurance - If you operate occasional supper clubs from home, with strict guest limits.
3. Fleet or commercial vehicle insurance - If you deliver regularly or run a mobile catering unit.
4. Event insurance - Short-term cover for one-off festivals or venues.
5. Directors’ and Officers’ insurance - Protects management decisions in limited companies.

Common questions, answered simply

Q: Is Employers’ Liability really mandatory? A: Yes, if you employ anyone in the UK, including part time or temporary workers. You must display your certificate and keep it available for inspection. Fines can apply for non-compliance.

Q: How much Public Liability cover do I need? A: Many restaurants choose £2 million to £5 million. Higher limits may be sensible in busy locations, large venues, or where landlords or events require specific minimum limits.

Q: Why are premiums higher than a few years ago? A: The market hardened after the pandemic with reduced capacity and higher claims costs. Many restaurants saw 40-50% increases. Strong risk controls and accurate information help secure better terms.

Q: Do I need Cyber insurance if I use third-party payment providers? A: It is still helpful. You may remain responsible for customer data, bookings, email accounts, and business interruption from system outages or ransomware affecting your devices and networks.

Q: How long should my Business Interruption cover last? A: Consider at least 12 months, often 24 for full rebuilds and fit-outs. Factor in planning permissions, contractor lead times, and specialist equipment delivery when choosing your indemnity period.

What to do next

Take stock of your risks, gather accurate figures, and compare quotes that clearly state limits, exclusions, and indemnity periods. If anything is unclear, ask for written clarification. A good broker can help you avoid gaps and keep cover proportionate to your budget. You stay in control of the final decision.

Important information

This guide is general information, not personal financial advice. Policy terms, limits, and exclusions vary by insurer and individual circumstances. Always read the full wording and endorsements, check sums insured carefully, and confirm details before you buy.