In the United States, food truck insurance is known to cost around $40 to $300 per month; however, it is imperative to note that the exact amount will depend on a whole lot of factors such as your provider, coverage, risks, income, equipment, and operations.
Also note that the sort of service you render, your location, the number of employees you have, and other factors will impact your customized quote.
Food truck insurance is a policy that takes care of the liabilities and risks that come with running a food truck business. It is important for anyone considering starting a food truck business to obtain the right coverage prior to opening their windows to tend to patrons.
By being fully informed of the monthly cost of your food truck insurance and determining your potential liabilities, you can be satisfied that your policy covers all your needs and that your business will be safe in the event of an accident or other incident.
Factors That Determine the Monthly Cost of Food Truck Insurance
Just as was stated above, the exact amount you pay monthly for your food truck insurance will depend on a whole lot of factors. Those factors include;
1. The insurance provider
You have to understand that your insurance provider reserves the right to set their rates depending on certain criteria set by the company. Since each company tends to have its own policies and preferred coverages, they will also have their own rates, and those can vary widely.
2. The size of your business
Most often, the business portion of your insurance will feature premiums that depend on how large or small your business is.
3. State policies
In the United States, States tend to possess their own regulations on the sort of coverage businesses in the food service industry are expected to carry. These regulations will most definitely help to determine the cost of your coverage.
Not just your state but the city or neighborhood where you intend to run your business will have a say in your food truck insurance monthly rates. One thing is for sure, safer areas will warrant better rates.
If you are operating a food truck, then it is more or less certain that you cook inside the truck. Howbeit, note that the equipment comes with its risks and those risks will be considered when putting together your coverage and it will most likely affect your premiums.
6. Equipment values
You should also note that the value of your equipment will be one of those vital factors that dictate the amount of coverage you need.
7. The amount of coverage
Also note that the amount of coverage you pick will determine the cost of your premium. Ideally, fewer policies or lower coverage limits can work to keep your premium costs lower. Same way, the more policies you have or the higher your coverage limits, the higher your premiums.
It is also possible to get lower premiums by having higher deductibles. You are assuming a good portion of the financial risk if you need to file a claim.
9. Your payroll
A food truck with employees will most definitely need workers’ compensation insurance. Your payroll coupled with the tasks assigned to employees will also determine the premium costs for workers’ compensation policies.
10. Cash value versus replacement cost
Food trucks with replacement cost coverage on their business policy will have to pay higher premiums. This is owing to the fact that replacement cost coverages don’t take depreciation into account when valuing your equipment.
How to Save Money On Food Truck Insurance?
The monthly cost of insurance can be quite massive, not just for food trucks but for almost all types of businesses. However, always remember that a food truck needs adequate insurance to cover the business, irrespective of what it costs. Nevertheless, to ensure that you can save money, here are tips to follow.
Compare Rates from Several Providers
This is indeed one of the best ways to find the cheapest food truck insurance. It is very possible to obtain quotes online from providers like Progressive and make your comparison.
You can also choose to work with a reputable broker like Simply Business, CoverWallet, Commercialinsurance.net, or Smart Financial. These brokers are known to obtain quotes from several companies that they work with and you can compare several quotes easily and choose the one that is more convenient for you.
Have the Best Staff
You have to understand that your staff can make or break your insurance policy premiums. Your food truck is more or less a restaurant but features a smaller footprint. As such, you would want to have a staff who can do their best work with little space or direction.
Don’t forget to verify that your employees have clean backgrounds, clean driving records, the right training, and ServSafe certification, especially since it will work to keep your premiums at a manageable level.
Keep Your Truck Well-Maintained
Also, note that appropriately maintaining the truck and cooking equipment will work in your favor. Aside from the fact that it will go a long way to guarantee the success of your business.
It will also help to prevent accidents both in the kitchen and on the road. Fewer accidents will warrant fewer claims and this will mean better pricing for insurance costs.
Follow All Safety and Cleaning Procedures
Comply with all cleaning and safety protocols. Ensure to confirm with all procedures stipulated by governing agencies such as the local health department. Your policies will have to encompass daily, and weekly cleaning actions, and every employee should know them and follow them unequivocally.
Ask for a High Deductible
It is also possible to save money on your premiums with higher deductibles since it means that you’ve agreed to accept more of the financial risk that comes with any accidents. If you maintain a clean driving record and comply with all safety protocols when operating your truck, a high deductible doesn’t have to cause fear.
Ask for Bundled Coverage
You can also choose to have your coverages bundled as a way to save money. Paying for individual coverages or paying various companies for parts of the coverage you need will mean more expenses or more fees in the long run. Keep in mind that a good number of companies offer discounts when you bundle coverages.
A food truck business remains one of the most viable businesses to start in this modern age. The benefits are pretty clear. Howbeit, with these benefits also come certain risks. As such, to ensure that you adequately protect yourself against these potential scenarios, it is important you obtain a comprehensive food truck insurance policy.
Howbeit, just as it was noted above, food truck insurance in the United States tends to cost around $40 to $300 per month; however, it is imperative to note that the exact amount will depend on most of the factors noted above.