Insurance for Home Food Businesses – What do You Need?

The Covid Pandemic has seen many people change their daily routine – to retrain, volunteer, or sometimes launch a whole new business from home. What was a hobby for many is now an actual income stream.

One example of this is the increase in food businesses – almost half of the new food businesses launched since the first lockdown are home-based, according to the FSA.¹ People have taken their skills to another level.

There has certainly been a demand for it, as restaurants and pubs all over the UK closed for many months. Deliveroo saw business double² in the last lockdown, and there has been a real focus on local suppliers and producers, with almost half the UK population planning to keep using local small businesses³ in the long run.

There are complications to consider, however. The first is hygiene and safety. If you’re looking to set up a home catering company, you should register as a food business; this means the relevant authorities can check you’re adhering to required standards. The safety and cleanliness of premises, the allergens and sell-by dates of ingredients and the methods used all need to be measured.

There is also the issue of insurance. Anyone turning their culinary passion into a profit needs to ensure they have the correct cover in place to protect against the risks associated with running a home food business. If you are thinking about it, you will need to have the right food liability insurances.

Public and Product Liability Insurance

Home food businesses are preparing food for public consumption. So, as well as adhering to hygiene standards, you will need to ensure you are covered if anything goes wrong. If a customer were to become ill after eating some of your products, this policy would cover the costs of any compensation claims.

Employers Liability Insurance

If your home food or home bakery business starts to grow and you need to get some help: congratulations! That’s fantastic news. However, you will need to add to your insurance cover as any business with employees needs to have this cover - by law. This ensures you are covered if a staff member has an accident at work, falls ill, and makes a claim against your business.

Buildings and Contents Insurance

It’s likely your home will already be insured. However, it’s vital to check whether this insurance is invalidated by your business operating from the same location. You may need to take out additional food business insurance - Home Bakery Buildings and Contents Insurance - in case your business causes a fire, or the products cause a power shortage, or your stock gets spoiled by a flood.

Goods in Transit Insurance

While your ingredients and finished products are covered by the above, they are not covered the minute they leave your home. Goods in transit insurance protect the goods while being transported between locations - essential if you are catering for events. If there is an accident, you are covered for the loss of the products and any claims made by your customers. You will also need to look at the insurance on any vehicle being used to transport your products.

Starting and building a food business from home could be a tasty alternative to a former corporate lifestyle or even a side venture to supplement an existing income.

Whatever way you approach it, though, you must research before you start.

If you would like any advice on this, call us to discuss your food business insurance needs, and we can develop a package that suits your requirements.

^{_{Sources 
1 standard.co.uk/food-home-businesses-operating-lockdown-watchdog 
2 theguardian.com/deliveroo-doubles-orders-during-latest-covid-lockdown 
3 smeweb.com/lockdown-loyalty-local-traders-reap-benefits-of-good-service}}