If you’re opening a butcher shop or meat market, it can come as no surprise that you’ll need to make sure to purchase an insurance policy that will cover you properly.

How do you know which coverage you need? What amount of coverage should you choose – and how much will it cost? Read on to find out.

What are Some of the Risks of Owning a Butcher Shop?

When it comes to owning a butcher shop, you’ll most likely process, package, and sell meat to your customers. You might also sell other food and grocery items at your shop.

While there are so many other options you can choose to offer your clients, there are general risks involved with these services that you’ll need to be covered for.

1. Damages to Your Products

How do you get from place to place? Where do you store your equipment?

If you offer food delivery – which has become common after the pandemic – and travel to different homes with a truck or van, you’ll want to make sure that your vehicles are all covered for potential damage.

Furthermore, your supplies – including meat cutting equipment and tools, cash registers (and any cash on premises!), and refrigerators should be protected in the event of theft, a fire, and more.

2. Injuries

Do you have a plan in place in the event you or your staff get injured on the job? Injuries common to owning a butcher shop include knife or machine injuries, slipping and falling, and more; they can occur to you, your staff, and even your customers – so it’s important to keep this in mind.

3. Meat Spoilage and Contamination

Selling spoiled meat, whether knowingly or unknowingly, can be extremely harmful to customers. Risks can include:

• Foodborne illnesses
• Lost sales from recalls

4. Improperly Maintaining Your Store

It’s crucial to maintain strict sanitary conditions in order for your business to be successful. This will include:

• Following federal regulations
• Ensuring your store is up to the health department standards
• Sanitizing your equipment after use
• Storing meat at proper temperatures
• Maintaining refrigerators and freezers – and updating them when needed

If your shop isn’t properly maintained, you (and your insurance company) can face major legal issues.

Types of Insurance Coverage a Butcher Shop Should Consider

With the risks involved in owning a butcher shop, insurance coverage is really important. It’s crucial to set up policies that can protect you as the business owner, your employees, the customers you’re servicing, and your products & equipment.

Generally, purchasing a Business Owners Policy (BOP) will provide you with all the coverage you need – however, it’s important to know what to include. Here are the must-have insurance coverages for your business:

1. Business Auto Insurance

If you deliver food to your customers, a business auto policy can cover you, your employees, and your vehicle(s) – and will make sure you’re covered for:

• Damage to your vehicles or someone else’s vehicle as a result of an accident
• Property damage (i.e., in the event your vehicle causes damage to a fence, pole, or other fixed objects)
• Liability (in the event you are sued due to a motor vehicle accident)
• Injuries and medical bills (to the drivers of your vehicles and a third party)

How Much Does Business Auto Insurance Cost?

The annual cost for business auto insurance can vary depending on:

• How many drivers are operating the vehicles – and their driving records
• How many vehicles are on the policy
• The type of vehicle (i.e., specialized lift trucks vs. a cargo van)
• How much coverage you choose to have

Costs range approximately $720 – $1,200 per year ($60 – $100 per month).

2. General Liability Insurance

Simply put, general liability insurance covers you in the event your business gets sued for nearly any business-related issue.

This coverage will make sure you’re covered for injuries and damages caused by you and your employees – and if you get sued for anything that happens at your business location.

In particular, you’ll need this coverage to protect you from lawsuits that might arise from:

• Improper use of equipment
• Injuries to customers and shoppers
• Negligence on your or your employee’s part
• Food spoilage and selling contaminated meat
• False advertising
• Products liability coverage

Typically, the best coverage option is to select a “Per Occurrence” option for your liability. This means that you’ll be protected for every incident that occurred during your policy term, as long as you had an active policy at the time.

Coverage amounts will typically be offered in increments of $1,000,000. You might see this coverage listed as:

$1,000,000/$2,000,000

What this means is that you’ll have $1,000,000 in coverage for each occurrence (i.e., each time you get sued), with a maximum of $2,000,000 in coverage for the entire policy period (typically 1 year).

How Much Does General Liability Insurance Cost?

This tends to vary depending on:

• How many locations you have
• Whether or not you have a parking lot
• How many employees you have
• Whether or not you have been sued in the past

Since butcher shops have a high products liability risk (due to the high likelihood of spoilage and contamination), a $1,000,000/$2,000,000 general liability policy will cost approximately $1,000 – $2,000 per year.

3. Commercial Property Insurance

Butcher shops need to be covered in the event something happens to your property (or landlord’s property) or if there’s damage to property rented by you. Typically, this will cover you in the event of:

• Fire
• Flood
• Theft
• Vandalism
• Pipe burst
• Loss of use/Business Interruption (i.e., you can’t open your store due to one of the reasons above; this needs to be added onto your property policy – so be sure to ask your agent for it!)

Items that you might need to cover include:

• Your meat products and goods for sale
• Cash on-premises
• Store furniture (i.e., counters, refrigerators, and shelves)
• Tools and equipment (i.e., grinders, knives, saws, etc.)

It’s important to keep in mind that business property insurance only covers your items if they’re damaged in your specified location – and not anywhere else. 

How Much Does Business Property Insurance Cost?

The average cost of business property insurance coverage for a butcher shop is approximately $800 -$1,200 per year and can vary based on:

• The size of the location
• How much coverage you need
• The approximate total value of food, tools, and equipment kept on-premises

4. Inland Marine Insurance

Don’t let the name fool you! This is essential coverage for butcher shops that deliver their products to customers, as it protects all of your tools, equipment, and supplies no matter where they are – whether it’s in transport, in storage, or currently in being delivered to customers.

Typically, this policy covers you in the event they are lost, stolen, or damaged – and is especially important for your:

• Cash in transit
• Meat
• Tools or equipment that you have in storage

Most insurance companies require that large items and machinery be 5 years old or less, and you’ll be required to take an itemized inventory of what you’d like to be insured.

How Much Does Inland Marine Insurance Cost?

Inland Marine policies for butcher shops will typically cost anywhere from $100 – $200 per year.

5. Workers’ Compensation Insurance /Disability Insurance

If you have employees, purchasing a worker’s compensation policy is extremely important. In fact, butcher shops often have a high likelihood of workplace injuries (specifically due to machine, equipment, and knives) – and most states require that you maintain a current and active policy.

A worker’s compensation policy will cover you and your employees in the event of:

• Injuries sustained while working, regardless of how they occurred
• Loss of wages
• Disability caused by work accidents

How Much Does Worker’s Compensation Insurance Cost?

Costs vary based on the risk of injury involved, the number of active employees, and the total salary that each employee is paid per year. On average, worker’s compensation rates for a butchers insurance policy can cost $2,000 – $3,000 per year.

The Bottom Line

With the different services you can offer, it’s important to make sure your butcher shop is covered properly. Purchasing a Business Owners Policy can make sure that you’re covered for everything listed above – and having one policy (under the same insurance company) can save you money.

Here are the average annual costs for a butcher shop’s insurance coverage:

• Business Auto: $720 – $1,200/year
• General Liability: $1,000 – $2,000/year
• Business Property Insurance: $800 – $1,200/year
• Inland Marine: $100 – $200/year
• Workers Compensation: $2,000 – $3,000/year

In total, insurance for your butcher shop will cost approximately $4,620 – $7,600/year.

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