How Much Does Food Business Insurance Cost?
A small UK food business pays £560-1,200/year for essential insurance (public liability + product liability + employers liability). Only Employers Liability is legally mandatory if you have staff (£2,500/day fine without it). Public and product liability are not legally required but are effectively essential — most landlords, markets, and delivery platforms require them. A bundled public + product liability policy starts from £67/year for a home-based business.
Types of Food Business Insurance
Public Liability Insurance
Claims if a customer or member of the public is injured on your premises or by your business activities. Covers legal costs and compensation payments.
Typical Cover
£1M-£10M
Annual Cost
£67-420/year
Who Needs It
Every food business. Most commercial landlords, markets, and delivery platforms require it.
Small takeaway £67-86/year. Cafe with 1-2 staff £310-420/year.
Product Liability Insurance
Claims if your food products cause illness, injury, or allergic reaction. Covers legal defence costs and compensation.
Typical Cover
£5M-£10M
Annual Cost
£65-78/year (often bundled)
Who Needs It
Every food business. Critical for allergen-related claims under Natasha's Law.
Usually bundled with public liability for £560-700/year total.
Employers Liability Insurance
Claims from employees who are injured or become ill because of their work. Covers all staff including part-time, temporary, and volunteers.
Typical Cover
£5M minimum (£10M standard)
Annual Cost
£400-500/year
Who Needs It
Any business with employees, including part-time and temporary staff.
Small food business. Fine of up to £2,500/day without it.
Equipment & Contents Insurance
Covers commercial kitchen equipment against damage, theft, fire, or flood. Includes ovens, fridges, extraction systems, and stock.
Typical Cover
Based on replacement value
Annual Cost
£200-1,500/year
Who Needs It
Any business owning kitchen equipment. May not be needed if using a managed kitchen that provides its own cover.
Depends on total equipment value. Ghost kitchen £200-500/year. Full restaurant £800-1,500/year.
Business Interruption Insurance
Covers lost income if your business cannot operate due to fire, flood, equipment failure, or other insured event.
Typical Cover
12-24 months of gross profit
Annual Cost
£100-500/year
Who Needs It
Any food business dependent on a single premises. Essential for delivery-only operators.
Added to property/contents policy. Cost depends on revenue.
Insurance Costs by Business Type
| Business Type | Public + Product | Employers | Equipment | Total/Year |
|---|---|---|---|---|
| Home-based food business | £67-150 | N/A (no staff) | £100-200 | £170-350 |
| Ghost kitchen / dark kitchen | £150-300 | £400-500 | £200-500 | £750-1,300 |
| Food truck / mobile | £200-400 | £400-500 | £300-600 | £900-1,500 |
| Small cafe (1-3 staff) | £310-420 | £400-600 | £500-1,000 | £1,200-2,000 |
| Restaurant (5-10 staff) | £400-700 | £600-1,600 | £800-1,500 | £1,800-3,800 |
| Meal prep / catering | £200-400 | £400-500 | £300-800 | £900-1,700 |
Costs are annual estimates based on UK market averages in 2026. Actual premiums depend on turnover, location, claims history, and number of staff.
Common Insurance Claims in Food Businesses
| Incident | Insurance Type | Typical Payout |
|---|---|---|
| Slip and fall on wet floor | Public Liability | £3,000-£20,000 |
| Food poisoning (group claim) | Product Liability | £5,000-£100,000+ |
| Allergic reaction (severe) | Product Liability | £10,000-£500,000+ |
| Staff burn from hot oil | Employers Liability | £5,000-£30,000 |
| Kitchen fire (equipment loss) | Equipment / Contents | £10,000-£50,000+ |
| Delivery driver injury on premises | Public Liability | £2,000-£15,000 |
Allergen Claims Are Rising
Since Natasha's Law (October 2021), allergen-related claims have increased significantly. A severe allergic reaction claim can exceed £500,000. Product liability insurance is your primary defence. Ensure your policy explicitly covers allergen incidents.
Employers Liability — The Legal Requirement
Legal Requirements
- Mandatory from your first employee (including part-time)
- Minimum cover: £5 million (£10M standard)
- Certificate must be displayed at premises
- Fine: up to £2,500 per day without cover
- Covers all staff: permanent, temporary, volunteers
Who Is Exempt
- Sole traders with no employees
- Family businesses where all workers are close family
- Companies with only the owner as employee (some limited companies)
Note: If you hire anyone — even a part-time kitchen porter — you need employers liability immediately.
Where to Buy Food Business Insurance
Comparison Sites
- Simply Business — largest UK SME insurer
- Compare the Market — business insurance section
- NimbleFins — specialist food business comparisons
Specialist Providers
- Hiscox — tailored small business policies
- CMTIA — specialist food industry insurance
- FSB Insurance Service — Federation of Small Businesses
Save Money on Insurance
Bundle policies: Public + product + employers liability in one policy saves 15-25%.
Pay annually: Monthly payments add 10-20% to the total cost.
Food hygiene rating: A 5-star rating can reduce premiums.
Claims-free discount: Each year without a claim reduces your renewal price.
Insurance for Ghost Kitchens & Dark Kitchens
Ghost kitchens have specific insurance considerations. Managed kitchen operators provide building insurance but you are responsible for your own business insurance.
Managed kitchen (Karma, Dephna, Foodstars)
Building insurance included in rent. You need: public liability, product liability, employers liability (if staff). Budget £750-1,300/year.
Own premises / industrial unit
You need everything: public liability, product liability, employers liability, equipment insurance, business interruption. Budget £1,200-2,500/year.
Shared kitchen / hourly hire
The kitchen provides building and equipment insurance. You need: public liability and product liability. Budget £170-500/year.
Delivery platform requirements: Deliveroo, Uber Eats, and Just Eat all require proof of public liability insurance before you can onboard. Most require a minimum of £5M cover. Keep your certificate accessible — you will need to upload it during registration.
Written by
James Mitchell
Ghost Kitchen Operations Director & Industry Expert
Frequently Asked Questions
What insurance do I need for a food business in the UK?
At minimum, you need Public Liability insurance (covers customer claims, £67-420/year) and Product Liability insurance (covers food-related illness, usually bundled). If you have any employees, Employers Liability insurance is legally mandatory (minimum £5M cover, £400-500/year). Equipment insurance and business interruption cover are also recommended. Total insurance costs for a small food business typically run £560-1,200/year.
How much does food business insurance cost in the UK?
Food business insurance costs £170-3,800/year depending on business type and size. A home-based food business pays £170-350/year. A ghost kitchen or dark kitchen pays £750-1,300/year. A small cafe with 1-3 staff pays £1,200-2,000/year. A restaurant with 5-10 staff pays £1,800-3,800/year. Public and product liability bundled typically costs £560-700/year for small operations.
Is public liability insurance mandatory for food businesses?
Public liability insurance is not legally required in the UK, but it is effectively essential. Most commercial landlords require it in the lease, delivery platforms like Deliveroo and Uber Eats require it for onboarding, and markets require minimum £5M cover. Without it, a single claim could bankrupt your business. Cover of £1-2M is standard; £5-10M is recommended.
Do I need employers liability insurance for a food business?
Yes, if you have any employees. Employers Liability insurance is legally mandatory under the Employers Liability (Compulsory Insurance) Act 1969. You must have minimum £5M cover (£10M is standard), your certificate must be displayed at your premises, and it covers all staff including part-time, temporary workers, and volunteers. The fine for not having it is up to £2,500 per day.
Do ghost kitchens need insurance?
Yes. Ghost kitchens and dark kitchens need the same insurance as traditional restaurants: public liability, product liability, and employers liability if hiring staff. Many managed kitchen operators (Karma Kitchen, Dephna) include basic building insurance but NOT your public/product liability — you must arrange this yourself. Delivery platforms require proof of insurance before onboarding.
What does product liability insurance cover for food businesses?
Product liability insurance covers claims if your food causes illness, injury, or allergic reaction. This includes food poisoning outbreaks, undeclared allergen reactions (critical under Natasha's Law), contamination incidents, and mislabelling claims. It covers legal defence costs and compensation payments. Typical cover is £5-10M and costs £65-78/year when bundled with public liability.
Where can I buy food business insurance in the UK?
Major providers include Simply Business (compare quotes online), Hiscox (specialist small business), NFU Mutual (if rural), and specialist food brokers like CMTIA, NimbleFins, and FSB Insurance Service. Always compare at least 3 quotes. Specialist food business policies are cheaper than general commercial policies because the risk is better understood. Most policies can be purchased online in minutes.
Does food business insurance cover delivery?
Standard public and product liability insurance covers the food you produce regardless of how it reaches the customer. However, if you employ your own delivery drivers, you need motor fleet insurance and your employers liability must cover drivers. If using third-party platforms (Deliveroo, Uber Eats), the platform's own insurance covers the delivery rider — but your product liability still covers the food itself.