Cafe and Coffee Shop Insurance

Cafe and coffee shop insurance describes several coverages that provide a comprehensive policy for your business. Typically, cafe and coffee shop insurance will include the following policies:

• Commercial General Liability (CGL) Insurance: CGL or “slip-and-fall insurance” can provide coverage against the day-to-day risks while running a cafe or similar business. If a third party is injured or their property is damaged at your location, they can sue. For example, say, a customer falls off a wobbly stool at your juice bar and injures their back. CGL would typically cover legal expenses and third-party medical bills, regardless of the legal outcome.

• • Product Liability Insurance: As part of a CGL policy, you can be covered for injuries or property damage caused by defective products that you manufacture, sell or distribute – this includes the food and drink products you serve. For example, you sell pre-baked cookies in your cafe, and a customer has a serious allergic reaction, claiming there must be nuts in the product even though the ingredients didn’t list it. In this case, your customer could sue, and product liability insurance may cover you for legal defence costs and third-party medical expenses.

• Commercial Property Insurance: Commercial property insurance protects your eatery location and the contents within it from insured risks that occur, causing damage beyond your control, like a fire, theft, or storm. Say a severe windstorm impacts your business, and loose shrapnel smashes your cafe’s front window. Commercial property damage could cover the costs of replacing the window and any subsequent damage within your cafe.
  • Business Interruption Coverage: This coverage is often part of a commercial property insurance policy and provides you with reimbursement for net income lost following an insured event. Say, after the windstorm damage example above, you had to close shop for a few days to fix your window. This coverage could cover the costs of the estimated lost income and other expenses. However, this coverage does not cover income lost due to an infectious disease, pandemic, or government-mandated closure.

• Equipment Breakdown Insurance: This insurance covers the costs to repair or replace professional equipment (e.g., a commercial kitchen appliance) that’s broken down or damaged due to an internal event, such as a mechanical or electrical failure. You can also be covered for subsequent expenses that are lost due to the breakdown. For example, say you run a coffee shop, and your expensive espresso machine breaks down due to a mechanical fault during a busy Monday morning. Equipment breakdown coverage could cover the costs to repair the device and provide financial reimbursement for the income lost due to the breakdown. Please note that an equipment breakdown insurance policy cannot be purchased without property insurance.

• Cyber Liability Insurance: If you store personal data (e.g., using a point-of-sale system or if customers order through your website), you have a legal obligation to protect that information. Cyber insurance will cover costs like legal fees associated with electronic incidents or hacks that involve your technology and confidential or personal data.

• Legal Expense Insurance: If you need legal representation for a situation beyond what you’re covered for by your insurance policies (e.g. protection for your property or injury to yourself or an employee), legal expense insurance can provide financial coverage for hiring a lawyer. This coverage also covers the cost of legal advice and legal representation.