Food & Beverage Manufacturing Insurance

In an industry like food and beverage manufacturing, there are always health and safety regulations to comply with. Add in the day-to-day risks of simply running your business, and you have your work cut out for you.

For example, machine chains could break down because of wear and tear. A worker on the line might get their hand caught in the machinery. Your ingredients might be contaminated and you may not know it until consumers start getting sick.

Food manufacturing insurance can't prevent these incidents from happening, but it can help your business handle the aftermath. Here are some policies that can help safeguard your income and assets.

General Liability Insurance

General Liability Insurance can protect your business against a lot of common mishaps, such as…

  • Third-party (non-employee) injuries and property damage.
  • Advertising injuries (like copyright infringement).

For example, say a potential distributor is touring your facility. They trip, fall, and break their wrist. Their laptop and phone shatter in the fall, too.

Your General Liability policy can help pay for their medical bills and the cost to replace their electronics. If you're sued over the incident, your policy can help address your legal expenses.

Product Liability Insurance

In any manufacturing environment, defective products are a risk. However, in food and beverage manufacturing, the stakes are even higher. If there's something wrong with the products you make, a lot of people could get sick.

Product Liability Insurance can protect your business if your food products are contaminated or make someone ill. For example, says someone gets food poisoning from a bad batch of your goat cheese. If they sue, your Product Liability Insurance should be able to cover your legal expenses. For a more in-depth look at how this policy can protect your business, read "How Restaurant Insurance Can Help after a Chipotle-Style Outbreak."

Though Product Liability coverage may be included in your General Liability Insurance policy, that's not always the case. Talk to your agent about the most effective way to get this coverage.

Product Recall Insurance

If you have an entire batch of products that are tainted, Product Recall Insurance may shoulder the cost of a recall. Let's say that you realize that a shipment of your pre-mixed salad jars may have been contaminated with E. coli. You need to alert consumers and make sure all the contaminated salads are pulled from shelves and properly disposed of.

Product Recall Insurance can pay for:

  • Collecting recalled products.
  • Disposing unsafe products.
  • Hiring a crisis and PR management firm.

Product Recall Insurance can cover both voluntary and involuntary recalls. Considering the average cost of a recall is $10 million for food manufacturers, this can be valuable coverage. You can usually add this coverage to your General Liability policy.

Business Owner's Policy

You may qualify for a Business Owner's Policy (BOP) if your operations are considered low risk. This policy combines General Liability with Commercial Property Insurance, usually at a reduced rate.

Commercial Property Insurance can cover your inventory, equipment, and manufacturing facility from loss or damage caused by:

  • Fire.
  • Windstorms.
  • Theft.
  • Vandalism.

For example, if you rent your commercial kitchen space and a fire destroys it, your BOP can help pay to repair or replace your damaged equipment and supplies. If you own your facility, it can pay to repair the building as well.

You can customize your BOP with additional coverage. Talk to your agent about whether you might benefit from:

Workers' Compensation Insurance

You likely have workers helping out at your manufacturing facility. They might work in production, shipping and receiving, transportation, or office administration. If something goes wrong and an employee is hurt at work, Workers' Compensation Insurance can help pay for their medical bills and partial lost wages if they miss work to recover. Depending on which state your business operates in, you may be required to provide this coverage.

Cyber Liability Insurance

If you accept online payments or credit card payments, you're vulnerable to one of the biggest headaches for modern business owners: cyber theft.

Cyber Liability Insurance can help your business pay for cleanup costs when your sensitive data is hacked or stolen. This policy can help cover…

  • The cost to notify affected parties.
  • Legal expenses if your customers sue you over the breach.
  • Credit monitoring services for customers affected by the breach.

You can usually purchase Cyber Liability Insurance as a standalone policy or add it to another policy, such as a BOP.