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Don’t Get Burned: What You Need To Know Before You Buy Bakery Insurance

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Your bakery is the bread and butter of your livelihood and we at FLIP understand this. Who better to provide insurance for your bakery  business than an established player and trusted insurance provider in the food industry?

Your baked goods bring joy into the lives of your customers, unfortunately, with so many moving parts, it’s not always possible to control each aspect of your business.

We sat down with JoAnne Duke, a licensed insurance agent, and FLIP’s business development manager, to chat about the risks associated with running a bakery and what types of insurance coverage you should have to best protect it.


“When it comes to various types of insurance coverage for bakeries there isn’t necessarily a box to fit your business into. You need the proper coverages that are customized to fit your business requirements,” says Duke. “The most well-known types of insurance include commercial property, general liability, and worker’s compensation. However, there are additional coverages that many bakery owners may not be aware of that you should consider.”

Commercial Property Insurance
This type of insurance policy provides coverage for your business’s physical property. For example, if a fire were to break out in your store, this is the insurance that would respond.
Commercial General Liability
Commercial general liability is a type of insurance policy that provides coverage for a variety of circumstances such as bodily or personal injury, property damage caused by your business’s operations or products, and injury that occurs on the business’s property.
Workers’ Compensation
Workers’ compensation is a publicly sponsored program that provides wage replacement in the event an employee is injured on the job or performing job functions.


Endorsements are helpful additions to your bakery insurance policy that alter or extend the coverage of your policy. Expanding your commercial property and general policies is a smart way to protect your business from third-party claims arising from slip-and-falls or contaminated products. You can also add equipment and spoilage coverage to your policy to ensure that your goods are safeguarded.

Spoilage Coverage

For a low premium, you can add spoilage coverage to your policy.

“Many unexpected situations can take place when you run a bakery. Equipment breakdowns, such as with refrigeration appliances, can cause food spoilage but it’s not the only factor,” says Duke. “You could deal with power failure, equipment being damaged from being plugged and unplugged, or you could receive an already spoiled ingredient from your food vendor, which is expensive to replace, especially because you typically order those items in bulk.”

Product Liability

Product liability insurance covers the products that you prepare and distribute to your customers. This would respond in the case of contamination of the product or foreign substance in the food.

“An example of food contamination took place several years ago at a well-known food establishment, where an employee used lye instead of sugar in a sweet tea mix. The result of that mistake cost millions of dollars because a customer consumed the lye-laced tea mix and wound up in the hospital for treatment of esophageal burns,” Duke recalls. “Unfortunately, that type of thing occurs all of the time. No one imagines that it’ll happen, but there’s no way to control it.”

Other common items that have found its way into food unbeknownst to the preparer are nutshells and shards of glass.

“It’s easy to not realize that something like that is getting in the food you’re prepping. Bakers specifically have a big exposure because you start your shift early in the morning and may not be fully awake,” Duke says. “Also, you make food in bulk and are likely using the same batch of dough for several different products; everything you prepare that day may be affected by one event.”

Premise Slip-and-Fall

“Bakeries have a fast turn over and a lot of foot traffic, which means there’s more potential for someone to spill their coffee or drink while they’re in the store,” Duke says. “It’s a good idea to add this endorsement to your policy for added coverage limits.”

As you already know, your business consists of several varying day-to-day aspects and it’s impossible to fully control the outcome of every circumstance. Get the proper coverage and protect your livelihood. Contact one of our knowledgeable representatives for your free bakery insurance quote today.

JoAnne Duke has worked in the insurance industry for over 20 years and has been an integral part of the FLIP team for over three years.

*Each policy has individual limits and coverages. This is an overview of types of insurance and does not guarantee coverage. Please refer to your policy for specific details.


Lyndsey Larsen is the Marketing Manager and writes about business, marketing, entrepreneurship, and insurance.

Lyndsey Larsen is an experienced writer with a background in corporate communications nonprofits, SAAS corporations, and nutraceutical companies. She has previously worked as a journalist for regional and national publications. In her spare time, she enjoys chasing butterflies, rockhounding, and spending time with her two kids in Utah’s mountains or deserts. Find Lyndsey on LinkedIn.

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