What Insurance Does My Bakery Need?
Most bakeries need general liability and product liability insurance, plus some type of property insurance to help cover customer injuries, foodborne illnesses, and damaged or stolen equipment. Policies start at $25.92 a month with FLIP, depending on your setup and whether you need coverage for employees, deliveries, or a storefront.
Bakers insurance is designed to help protect your bakery from costly injuries or damages, like a customer getting hurt or falling ill and blaming you. My family has owned a small town bakery in Northeast Ohio since 1913, so I’ve seen how much goes into protecting your livelihood beyond the oven.
Whether you bake custom treats from home or own a corner cake shop, treat this as your guide to what insurance you need, why you need it, how much it costs, and the fastest, simplest way to get covered.
A Quick Recipe for Bakers Insurance | |
Best insurance for home-based bakeries: ✔️ General liability for customer injuries or property damages ✔️ Product liability for accidents related to your baked goods ✔️ Inland marine (or tools and equipment coverage) for your mobile baking gear Why you need it: To protect your small business and satisfy market or venue requirements Most common risk: Foodborne illness claims and accidents while selling at markets Starting cost: $25.92/month or $299/year | Best insurance for storefront bakeries: ✔️ Business Owners Policy (BOP), including general and product liability ✔️ Commercial property insurance for your building and its contents ✔️ Workers compensation for employee injuries ✔️ Equipment breakdown for sudden mechanical failures Why you need it: To protect your small business and meet lease and state law requirements Most common risk: Customer slip-and-falls and foodborne illness claims Starting cost: $208.33/month or $2,500/year |
Do You Need Insurance to Sell Baked Goods?
Yes, you typically need insurance for selling baked goods, whether you bake from home, sell at local markets, or own a storefront.
Some states require specific coverages, like workers compensation. Still, insurance for bakers is often less of a legal mandate and more about satisfying contracts and protecting your business from unexpected costs.
Your bakery might be asked to provide a Certificate of Insurance (COI) for:
- Farmers markets and food festivals
- Shared or commercial kitchens
- Event venues for catering jobs
- Landlords for leasing building space
- Retail or wholesale partnerships
Homeowners insurance policies rarely cover business-related activity, so even home-based bakeries need bakers insurance to help cover costly accidents, like if a customer gets sick from undercooked custard or you scratch a venue’s table while setting up a wedding cake.
What Types of Insurance Do Bakers Need?
Bakers typically need a mix of liability and property insurance to cover common risks. Other coverages depend on your setup and how you operate, which is why it’s best to get a customized policy, so you’re not paying for anything you don’t need.
Let’s break down the different insurance types and which coverages you really need based on what kind of bakery you run.
Coverage | What It Helps Cover | Who Needs It |
Third-party bodily injuries and property damages | All bakeries | |
Claims involving your baked goods, such as foodborne illness or allergic reactions | All bakeries | |
Inland Marine (tools and equipment coverage) | Sudden, accidental damage or theft to movable business equipment, like mobile proofers, stand mixers, or turn tables | Home-based and mobile bakers who use equipment to make deliveries or sell at markets |
Workers compensation (required by law in most states) | Work-related employee injuries and illnesses | Bakeries with employees |
Accidents involving vehicles used for business | Bakers making deliveries or using vehicles for business-related tasks | |
The cost to recover from a cyber attack on your business or data breach of customer information | Bakers taking online orders, storing customer information, or using a point-of-sale device | |
Certain claims involving professional instruction/services | Bakers who teach decorating or baking classes | |
Commercial property | Buildings, inventory, furnishings, and other covered business property | Storefront/commercial bakeries |
Equipment breakdown | Certain mechanical or electrical equipment failures | Storefront/commercial bakeries |
Business income interruption | Certain lost income and ongoing expenses after your bakery has to temporarily shut down for a covered reason, such as a fire | Storefront/commercial bakeries |
What Insurance Do Home-Based and Cottage Bakers Need?
Making and selling baked goods from your home exposes you to business-related risks, especially if you also sell at bake sales, markets, or festivals. The two core coverages you need to protect against claims and meet market insurance requirements are:
- General liability for customer injuries or damages to rented space
- Product liability for claims of allergic reactions or food poisoning
If you run a pastry food truck or rent commissary space for large orders, you might want additional coverage for your vehicle and equipment, too. But insurance may not be the only requirement you need to meet.
Check Your State’s Cottage Food Laws
Every home-based bakery must follow its state’s cottage food laws, which exist to help regulate:
- What types of foods you can make and sell
- Where your baked goods can be made
- Any registration, licensing, or permit requirements
- Food and ingredient labeling rules
Although sometimes called cottage food law insurance, home bakery insurance is not required by these laws, nor is it designed to protect you if you break these laws.
Pro tip: Learn how to check your state’s cottage food laws for home bakeries with our guide to getting a cottage food license.
When You Might Need a Certificate of Insurance (COI) or Additional Insured
Mobile and home-based bakeries typically need a COI to meet insurance requirements for venues. If you’re a cake maker delivering a wedding cake and your red buttercream stains the vintage carpet, the venue wants to know you’re prepared to pay the cost to restore it.
Along with proof of insurance, farmers markets, shared kitchens, wholesalers, and property owners will often ask you to add them as an additional insured. This helps protect them if they’re pulled into a claim for an accident you caused.
Another reason you need bakery business insurance? Homeowners policies typically won’t allow you to add additional insureds. FLIP allows free, unlimited additional insureds on your COI, so you’re always prepared to meet market and venue requirements.
What Changes When You Open a Storefront Bakery?
Opening a storefront bakery opens your business to new opportunities, but it also exposes you to new risks. You’ll need to consider upgrading your insurance beyond liability, whether that means adding coverage or increasing your limits. Here’s why:
- You have a physical location to protect: A fire, burst pipe, or other covered loss could affect ovens, refrigeration, inventory, furnishings, and the building itself
- Customers are coming to you: More customers mean more foot traffic, which also increases the risk for slip-and-fall accidents
- You have employees: Having employees introduces the need for workplace coverages like workers compensation insurance
- A shutdown can cost more than damaged equipment: If a covered loss temporarily closes your bakery, lost income and continuing expenses become part of the risk
- Your lease has insurance requirements: Landlords commonly ask for a COI with specific limits or that you add them as an additional insured
For small, commercial bakeries, it’s best to get a custom bakers insurance quote where you can work with an insurance agent to ensure your bakery has all the protection it needs.
Protect More Than What Comes Out of the Oven
“Steineck’s Bakery started in 1913 and, since then, we’ve baked bread for thousands of homes and businesses, becoming a cornerstone in our community. Today, our small town bakery has fans from Cleveland, Ohio, all the way to southern Florida. Building a reputation like that takes hard work, great food, and a lot of trust, and insurance helps protect that.”
~ Kathryn Monsewicz, Cake Decorator at Steineck’s Bakery
How Much Bakery Insurance Do I Need?
To protect against common claims, most home bakeries need general liability insurance in the amount of:
- $1 million per occurrence (the max your policy can pay for a single covered claim)
- $2 million aggregate (the max your policy can pay for all covered claims in one year)
These are the most common coverage limits required by landlords, venues, and markets. You’ll also need product liability coverage equal to your general liability limit (usually about $2 million).
The amount of coverage you need depends on your bakery’s overall setup and the value of your equipment. For this reason, storefront bakeries often need higher or different limits to cover their property, employees, and any on-site accidents.
How Much Does Bakers Insurance Cost?
Most home-based and mobile bakers insurance policies through FLIP start at $25.92 a month or $299 a year. The cost can go up if you add optional coverages, like tools and equipment, or if you need commercial property coverage for a storefront location.
Here’s a look at the starting cost for insurance for a home-based bakery, a mobile bakery with equipment, and a storefront bakery:
Bakery Type | Starting Monthly Cost | Starting Annual Cost |
Home-based or cottage bakery | $25.92/month | $299/year |
Mobile bakery with tools and equipment insurance | $37.09/month | $433/year |
Storefront or commercial bakery | $208.33/month | $2,500/year |
According to FLIP’s Food & Beverage Industry Trends Report, $61 a month is the average insurance payment for mobile or home-based food or bakery businesses. Ultimately, your final price depends on factors like:
- Gross annual revenue
- Location(s)
- Employees (if you have any)
- Additional coverages
- Vehicles (if you add commercial auto coverage)
- Claims history
For a commercial bakery, the cost of insurance depends on the same factors, plus:
- Whether you lease or own your property
- The value of your business property
Like a tray of cookie samples, getting a quote is free. Plus, you can customize it to fit your business, so you can skip the guesswork and find affordable coverage in minutes.
What Does Bakers Insurance Not Cover?
Standard insurance for bakers will not cover wear and tear on equipment, intentional or unexplained losses, or anything that’s listed as an exclusion on your policy. You may be able to add coverage back for some of these risks, but not all of them.
Examples of what may not be covered include:
- Employee injuries or work-related illnesses (you’ll need workers compensation)
- Accidents that happen during deliveries (you’ll need commercial auto)
- Alcoholic beverages, products, or baked goods (you can add liquor liability coverage)
- Losses that cost more than your limit of insurance (you’ll need increased limits)
- Non-food products you might sell, like soaps or candles (these may need to be added separately)
- Failing to comply with local food and safety regulations
- Getting shut down by the health department
- Baked goods containing Cannabidiol (CBD), Hemp, or Hemp extract
Before buying insurance for your bakery, read the list of exclusions and make sure the types and amount of coverages you’re getting are enough.
What Can a Bakery Insurance Claim Look Like?
There are small accidents, like overproofing your bread or burning your pie crusts, and then there are big accidents that can lead to insurance claims, like customer injuries and unexpected damage. The right coverage can make a huge difference.
Claim Example | What Happens | The Coverage You Need |
Undeclared allergen | A customer with a nut allergy eats a cookie that contains walnuts that weren’t listed, and they have a severe allergic reaction | Product liability may help cover medical expenses, legal costs, or damages |
Customer slip and fall | A customer slips on a dropped pastry next to your farmers market booth and falls, spraining their wrist | General liability may help cover the customer’s medical costs and your legal fees if they decide to sue |
Bakery equipment damage | Your mixer falls out of your vehicle while you’re unloading for an event, damaging the central motor shaft and rendering it unusable | Tools and equipment insurance may help pay to repair or replace the mixer so you can stay in business |
Delivery mishap | You accidentally rear-end another vehicle while delivering a cake, damaging both vehicles and injuring the other driver | Commercial auto insurance may help cover the vehicle damage and the other driver’s medical costs |
Broken bakery windows | Overnight, someone threw a brick into several of your bakery windows, shattering them | Commercial property insurance can help pay to repair or replace the damaged windows after covered vandalism |
Pro tip: If you have a deductible for certain covered losses, like property or equipment damages, you’ll have to pay that deductible out of pocket before your coverage kicks in.
How to Get Bakers Insurance
Ready to get covered, or want to see how much your policy might cost? Get bakers insurance for your home-based bakery online with FLIP in less than 10 minutes. Follow these steps:
- Get an online quote
- Select or search your bakery type
- Enter your business information
- Select the coverages you want
- Purchase your policy and instantly download your COI
Planning to open a bake shop or storefront? Take a moment to fill out our online restaurant application, and one of our licensed insurance agents will contact you shortly to provide a free bakery insurance quote.
FAQs About Insurance for Bakers and Home-Based Bakeries
Do I Need Insurance for My Home Bakery?
Yes. You need general liability insurance for your home bakery if you are making and selling baked goods out of your home or at markets and special events. Most venues require proof of liability insurance before you can open a booth or cater an event. Plus, homeowners insurance policies may not cover business activities.
Does Homeowners Insurance Cover a Home Bakery?
Not typically. Homeowners insurance is designed to cover your home, personal property, and related liabilities, not accidents caused by your business. It also may not have sufficient liability limits or allow you to add additional insureds.
Purchasing a separate business insurance policy like FLIP’s bakers insurance better protects your home bakery from potential claims without interfering with your homeowners policy.
Do I Need Insurance to Sell Baked Goods at a Farmers Market?
Yes. Bakeries, including small, home-based bakeries, usually need general and product liability insurance to sell baked goods at a farmers market. Market managers typically ask food vendors to provide a Certificate of Insurance (COI), and may request to be added to your policy as an additional insured.
What Happens If I Need To File A Bakers Insurance Claim?
Follow these steps to file a claim if you have bakers insurance through FLIP:
- Log in to your online account
- Go to “Manage Policies”
- Click on “File a Claim”
- Complete the form with details and supporting evidence
- Submit your claim
A claims adjuster will contact you to walk you through the rest of the process. If you have any questions, contact one of our licensed agents for help.
Reviewed by: Andrew Adamus
Andrew Adamus is a Program Manager for Food Liability Insurance Program (FLIP). He is an underwriting leader with more than a decade of experience in commercial insurance, holding an MBA from Syracuse University along with AINS, API, AU, and AIS designations. Andrew believes that successful underwriting is built on strong relationships, thoughtful analysis, and a commitment to helping policyholders protect what matters most. His goal is to deliver insurance solutions that support long-term success.
Katie Monsewicz
Ohio-based copywriter and licensed insurance agent, Katie Monsewicz leverages her experience working in the food industry with her writing skills to help entrepreneurs achieve their business goals. She holds a bachelor's degree in journalism from Kent State University. Before working for FLIP, she wrote for multiple home, health, and retail brands and currently helps run her family’s century-old bakery business. Read Katie’s full bio.
Ohio-based copywriter and licensed insurance agent, Katie Monsewicz leverages her experience working in the food industry with her writing skills to help entrepreneurs achieve their business goals. She holds a bachelor's degree in journalism from Kent State University. Before working for FLIP, she wrote for multiple home, health, and retail brands and currently helps run her family’s century-old bakery business. Read Katie’s full bio.