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6 Primary Business Insurance Policies Every Newbie Food Entrepreneur Should Consider

food business insurance
After years of mastering your culinary prowess and learning how to bring your passion into a profitable venture, you finally open your first food business – a hippie dog cafe. With hundreds of coffee aficionados and animal lovers flocking to try a latte with some side of cuddles, what could possibly go wrong?

Everything is well – until one customer claims to be bitten by a rowdy Shih Tzu. On table number 14, another customer claims to be suffering from a severe peanut allergy caused by a mismatched order. And during the commotion, one employee suddenly slips and injures his back while mopping the slippery kitchen floor.

Who is held accountable? You, of course. No matter how healthy and tasty your products are, or how safe your work environment is, accidents are inevitable. Apart from compensating for the medical costs of the injured people, you may also face lawsuits against your establishment and risk your profits and assets. That being the case, buying a business insurance is a top priority, especially if you’re in the food industry.

Insurance seems like a waste of money until you finally need it. So don’t wait until you have your first product on the grocery store shelf or on the table of your first customer to purchase an insurance policy. Ahead are 6 of the insurance policies you may need for your food business.

1. General Liability Insurance

If a visitor suffers injury while at your place of business and sues you for the damages, a standard liability insurance may cover you. The policy is issued to business to protect them against liability claims for bodily injuries and property damage arising out of the business operations within the premises. Even minor accidents like slipping to the wet floor can be a heck of a financial loss when you think of the medical expenses topped with legal costs.

Getting a liability insurance ensures you won’t have to bear the full cost. The cost is generally in line with the risk of the industry. Therefore, we can assume that a restaurant that is open to the public will have a higher risk than a jam retailer that receive only a few onsite patrons.

2. Product Liability Insurance

When you think of its health repercussions, food businesses tend to be riskier than other enterprises. A slight hint of a flaw in your product, like faulty packaging, contaminants, and small foreign objects, may lead to a severe illness to consumers. With this, all food production enterprises are required to purchase a product liability insurance, whether it’s a huge bread distributor or a small pastry shop.

As its name implies, this policy covers claims of bodily injury or illness and/or property damage arising from eating or using your products. Product Liability Insurance should be purchased before you introduce your products to the public.

3. Property Insurance

Is your food business situated in a flood-prone area? If it is, then purchasing a property insurance is a must.

The policy protects your building and equipment against damage due to vandalism, fire, and flood as well as unfortunate incidents like theft. Other possible mishaps like windstorms, hail, and explosion may need additional coverage, but purchasing a standard property insurance is a great starting point. The coverage is based on the actual cost of replacing (or repairing) buildings and equipment.

4. Commercial Auto Insurance

Do you use vehicles for your business? Delivery vehicles, like motorcycles and trucks, are business assets that should be insured as well.

Commercial auto insurance is quite similar to what you may already have on your personal cars. It includes property coverage for your vehicle, liability coverage for the damage to other people, their vehicles, or properties, and coverage for the injuries of your driver and other passengers in your vehicle.

5. Workers’ Compensation

Buying workers’ compensation insurance is necessary as soon as you hire your first employee. The policy covers medical and rehabilitation costs, as well as lost wages, in the event your worker/s get injured on the job.

Workers’ compensation insurance works both ways for employees and for you, as an employer. Firstly, it compensates for the medical benefits and wages of the injured worker. Secondly, it protects you as the business owner against lawsuits to be filed against you in the event the employee dies or get permanently disabled. This may sound harsh but in exchange for the given medical benefits, the employee (and/or his family) must agree not to sue the employer for the incident.

6. Business Interruption Insurance

Let’s go back to our previous example – your cafe. Doggos and other frills aside, it is the quality of your coffee that keeps your business running. The coffee beans you use for your base are supplied by one source. If that particular supplier fails to deliver, you’re doomed. Well, not really. In this kind of scenario, business interruption insurance takes effect.

Business Interruption Insurance, as its name suggests, compensates for a company’s financial loss during an interrupted business operation. The policy also caters to companies that require a physical location to do business when the operations are suddenly paused due to a catastrophic event.

Author Bio:

Carmina Natividad is one of the enthusiastic writers for Insurance Adviser, one of the largest and most credible General Insurance businesses in Australia and New Zealand, providing high quality risk management advice for business owners.


7 Important Lessons To Teach Your Kids About Credit Cards

Teaching children about credit debit cards
Having a discussion with your kids about credit cards is as important as teaching them to drive and teaching them ill-effects of drinking & drugs. No matter what is your opinion about credit cards, it is your job to teach your kids about the credit cards. The kids have so many misconceptions and doubts when they are introduced to the concept of a credit card.

You should teach your kids to use credit cards correctly and they should also be made aware of the negative effects of its misuse. So, make sure you have taught these 7 important lessons to your kids about credit cards.

Teaching About Credit

Well, your kid should know the whole concept of credit, but unfortunately, teaching them can be quite tricky. If you are able to teach your kids the concept of borrowing, earning, and paying money, then I am sure you will be able to make your kids understand the concept of credit. When your kids grow, you can teach them more advanced things including – what are good debt and bad debt, the role of co-signer, and various other things.

Credit Cards Don’t Do Magic

Teach them when you use your credit card to buy something, you are actually using real money. Let them know when they take money out of their piggy bank to purchase a new toy, they don’t get that money back. You should be able to make your kids understand that they have to trade the money in order to get their favorite toy. Tell them when you use your credit card, it is same as taking money from the piggy bank.

It’s Perfectly Fine Not To Have A Credit Card

While credit cards do come handy in building a good credit score and it is a convenient way of spending, there are people who are able to manage their lives without them. Take some time out and teach your kids that using a credit card is a matter of choice, if he/she is not having a credit card, it is perfectly fine. You should first let him/her know them. Chances are that your kid is not ready to have a credit card at the age of 18.

Not To Accept Every Offer

Teach your kids that the credit card companies will start sending them irrelevant offers. Tell them initially when they have their own credit card, such offers will look attractive and they will be tempted to give it a try. Instruct them that they should not fill any form or click on any link sent on their email without involving you.

Monthly Payments

Make your kids aware of keeping their account in good standing. For this, they have to ensure they are making regular payments on their credit card. Your kids should pay off their whole balance on a monthly basis in order to avoid any finance charges. Let them know if they are paying their bill in full every month, this shows they are spending money as they can afford to spend it.

Watch Out For The Interest Rate

It is important you have informed your kids that the credit card companies will approach them with attractive offers and low-interest rates. Make them aware of the fact that such offers don’t last for long and it is important they have gone through the offers carefully. Most importantly, they should keep an eye on the interest rate month-to-month.

Credit History

It is your duty to make your kids aware of the importance of making the payments on time, making regular charges with the credit card and also paying off the balance in full each month. Teach them all this will help in taking their credit score up. Lenders keep a check on their credit score and they consider this score while lending them money.

Author Bio

Sophia Jones tries to live her life like the sun – setting her sights high and vowing to always rise up again. Always game for an adventure, Sophia loves widening readers and her own expectations of our vast, beautiful world. As a journalist, Sophia writes to inform. As a creative writer, Sophia strives to inspire. Overall, she hopes to captivate. She currently writes for on personal loans, credit cards, insurance and investing etc.