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Some companies now offer policies specially designed for mobile food businesses.
Farmers Insurance began offering all-inclusive food truck policies in California at the beginning of the year. The policies cover business losses and liability as well as vehicle mishaps.
Jake Rothfuss, vice president for Farmers Insurance Commercial Auto and Property and Liability, said his company studied the restaurant market and thought customers needed the new product.
“Food trucks is something that five, 10 years ago, we would have never introduced,” Rothfuss said. “From our standpoint, it’s a good case study around changing consumer patterns and responding to those quickly.”
Progressive Insurance and a San Francisco-based company called Insure My Food Truck also offer policies.
There were 4,130 food trucks in the United States in 2015, and they generated $1.2 billion in revenue, according to MobileCuisine.com.
In addition to vehicle coverage, the food truck policies typically cover food borne illness, spoilage and contamination, and injuries to customers. They can also provide income replacement in case damage to the truck shuts down the business for a while.
“It provides very robust coverages that used to really be available only to a brick and mortar restaurant,” said Rothfuss. “So, that coverage essentially goes with them wherever that food truck goes.”
Normally food truck owners have had to cobble together different types of coverage to fully protect their businesses. In some cases, owners are not aware their business is not fully covered.
“Many food truck owners think it’s enough to buy a commercial vehicle policy,” Rothfuss said. “But they’re not providing enough protection in case there is some sort of incident where a customer’s injured, for example.”
The cost of covering a food truck depends on the type of truck and how it’s equipped, but Rothfuss said a Farmers policy typically ranges from $2,000-$4,000 a year.