You take pride in providing delicious sandwiches alongside a variety of dips, meats, cheeses, and prepared foods in your deli. If something bad were to happen, like an allergic reaction or injury during work, everything you've worked for would be at risk. An independent insurance agent can help.
Every business needs a financial backup plan, and that's exactly what insurance is. From protection for your property and inventory to coverage in the event of an on-site injury, an independent agent who specializes in deli insurance can make sure you're completely covered. But first, let's learn more about the options available.
Does a Deli Need Insurance?
Businesses take a lot of money, blood, sweat, and tears to open. As a deli owner, you've got a building full of perishable food items, equipment to help you operate your business, employees, and customers coming in and out of your shop and eating your food. There's a lot at stake every day.
Insurance protects all of these things and your finances. When the unexpected happens, insurance steps in. Whether your deli faces a severe storm and suffers property damage or a customer slips and falls on freshly mopped floors, you need protection.
Here are a few things that could go wrong in a deli that should be addressed with insurance:
- A customer or supplier slips and falls in your shop
- Guests in your shop damage furniture, bathrooms, display cases, or equipment
- Food, beverage, or ingredients are contaminated or spoiled
- Ovens, refrigerators, meat cutters or other equipment break down
- Fryers or hot oil cause injuries or fire
- Fire, extreme weather, or a natural disaster cause damage
- Theft or vandalism is caused by customers or employees
What Types of Insurance Does a Deli Need?
If you're running a deli, then you're an expert in knowing what you need to be successful behind the counter. However, insurance can be a bit of a mystery. From how much coverage you'll need to what's included in different insurance policies, there's a lot to know.
There's no one single insurance policy that will cover all of your business needs. That's why you can use the following options to discuss what's appropriate for your business with your independent insurance agent.
General Liability and Property Insurance
- Example: Your air fryer catches on fire and burns the ceiling of your deli.
- Example: A hurricane brings in a flood and your prepared foods are ruined.
- Example: A customer has an allergic reaction to one of your deli offerings.
- Example: Your ad campaign slanders a competitor.
And other related claims that can arise from your business operations.
Delis Need Insurance Coverage for When Food Goes Bad
Since delis are in the business of serving perishable goods that are consumed by customers, special coverage is needed for product losses due to contamination or spoilage. This coverage is a separate policy that pays for certain losses if ingredients (meats, cream, butter, etc.) are spoiled or contaminated due to refrigeration breakdown, utility interruption, or some other type of foreign substance contamination.
If your local board of health or other agency forces you to close because of food contamination, your contamination and spoilage insurance may cover you for lost income during the shutdown period, as well as costs related to cleaning contaminated equipment and disposing of and replacing spoiled food.
Additional Insurance Coverages for Your Deli
Once you have these primary coverages in place, it’s important to consider the risks that are unique to your business. For these risks and peace of mind, consider the following types of insurance policies and how they may apply to your deli:
- Business income insurance: This replaces lost income if you must temporarily shut down your deli because of a covered event.
- Commercial umbrella insurance: This extends the limits of your liability insurance policies, acting as a financial safety net for excessive claims made against your business.
- Professional liability insurance: Also known as errors and omissions (E&O) insurance, these policies cover your business against negligence claims due to harm that results from mistakes or failure to perform.
- Product liability insurance: This protects your business in the event that a product that your shop or another retailer sells results in a claim.
- Commercial flood insurance: This covers the cost of flood-related damage to your business property which is not covered by most property insurance policies.
- Commercial earthquake insurance: This covers the cost of earthquake-related damage to your business property which is not covered by most property insurance policies.
- Workers’ compensation insurance: This protects your workers — including store managers, bakers, servers, and cashiers — from the costs of work-related injuries and illnesses. This coverage pays for medical bills and lost wages for employees who sustain cuts, burns, slip and fall injuries, repetitive motion injuries, or any other injuries or illnesses related to their work.
- Cyber liability insurance: This protects your deli if you are the victim of a cyber breach. If your computer network or website is hacked and confidential customer or vendor information is exposed, the damage to your reputation and bottom line can be insurmountable.
- Employment practices liability coverage: This protects you if a current or former employee sues you for discriminatory employment practices.
No two delis are the same and each one will require different coverage. That's why you'll want to discuss a plan with your independent insurance agent that meets your needs.
How Much Does Deli Insurance Cost?
The cost of insuring your deli is significantly less than the cost of the average small business claim without an insurance policy in place.
Without insurance, you will have to pay those costs with your own business assets and, in some cases, with your personal assets. And if you believe you can handle the expenses on your own, you should know that the cost of an average paid out liability claim is $15,000.
A small business insurance policy for a deli typically includes a number of different coverages, so it’s important to understand the things that affect the costs of common types of business insurance.
Cost Factors for Most Types of Insurance
- Size of premises: The larger your business location(s), the more opportunities there are for claims to be made. Therefore, you’ll end up paying more on insurance premiums.
- Condition of the property: Newer buildings will often draw lower costs because updated facilities are often safer and generally in better shape.
- Business hazards: The more hazardous the operations of your deli, the higher the premium costs. If your business has heavy machinery, like a forklift or heavy-duty mixers, you can expect premiums to be higher.
- Payroll size: Because workers’ compensation insurance pays benefits to employees based on a percentage of their salary, payroll size directly influences premium costs for workers’ compensation insurance.
- Claims history: Businesses with few claims in their history will often get a discount, and those with more claims than are typical will have higher premiums.
- Employment status of employee: Full-time employees cost more to insure since they spend more time directly involved in your workplace and are exposed to more potential accidents.
- Number of employees: The more employees your deli has, the greater the premiums.
- Severity potential: If your deli generates lots of revenue or has substantial assets such as inventory, expect higher premiums to cover the replacement cost.
An Independent Agent Can Help You Find the Right Deli Insurance
If you build your deli insurance portfolio on your own, you risk having gaps in your coverage. An independent agent in our network can work with you to assess your various risks, suggest suitable coverage options, explain policy details, and shop around for competitively priced policies that are a good match for your business.
Find an independent agent near you to learn more and to start building a comprehensive deli insurance portfolio.