If you run a food truck, you already know the risks. Hot oil, sharp knives, tight spaces, and hungry customers who want their tacos fast. But here's the thing most food truck owners don't think about until it's too late: the biggest financial threat to your business isn't burning yourself on the griddle or denting your truck in a parking lot. It's a customer getting sick from your food and deciding to sue you.
Product liability insurance is your safety net for exactly this scenario. It's actually part of your general liability policy, and it kicks in when someone claims your food made them sick or caused them harm. With 48 million Americans getting foodborne illnesses every year and lawsuits averaging $50,000 to over $1 million, this coverage isn't optional—it's essential. Plus, most festivals, events, and corporate clients won't even let you through the gate without proof of at least $1 million in coverage.
What Product Liability Insurance Actually Covers
Product liability insurance covers claims that your food or beverages caused bodily injury or property damage to customers. The good news? It's already baked into your general liability policy—you don't buy it separately. When you see "general liability insurance" for your food truck, product liability is automatically included.
Here's what it protects you from: a customer claims they got food poisoning from your chicken shawarma. They're hospitalized for three days with salmonella, rack up $15,000 in medical bills, and hire a lawyer. Your product liability coverage pays for your legal defense, court costs, settlements, and judgments up to your policy limits. Without it, those costs come straight out of your pocket—and could easily bankrupt your business.
The coverage extends beyond foodborne illness. If a customer bites into your burrito and chips a tooth on a piece of metal that somehow got into your food, that's covered. If someone with a severe peanut allergy eats your pad thai because you didn't properly label the allergens and ends up in the ER, that's covered. Burns from coffee that's too hot, cuts from broken glass in a smoothie, allergic reactions to undisclosed ingredients—all product liability claims.
Product Liability vs. Completed Operations Coverage
This confuses a lot of food truck owners, so let's clear it up. Product liability specifically covers problems with the products you sell—the actual food and drinks. Products-completed operations is broader coverage that includes product liability but also extends to your services and completed work.
Think about catering a corporate event. If guests get sick from your food, that's product liability. But if you show up two hours late, the event is ruined, and the client sues you for the $10,000 they spent on the venue they couldn't use—that falls under completed operations coverage, not product liability. Or say you're catering a wedding, and your staff accidentally damages the venue's floor while setting up equipment. That's a completed operations claim.
Both coverages typically come bundled in your general liability policy, but understanding the distinction helps you grasp the full scope of protection you're getting. Product liability is about defects in what you sell. Completed operations is about everything that happens after you've finished your service or delivered your product.
Why Product Recall Insurance Is a Separate Thing
Here's where food truck owners get tripped up: product liability insurance covers lawsuits from customers who get sick or injured. It does not cover the cost of actually recalling your products when you discover a contamination problem.
Product recall insurance is a separate add-on endorsement that reimburses you for the expenses of managing a recall—whether it's voluntary or mandated by a government agency. Say your supplier notifies you that the chicken you've been using for the past week was contaminated with listeria. You need to immediately stop selling anything with that chicken, notify customers who bought from you, potentially retrieve and destroy already-sold products, deep clean your equipment, and lose business while you're shut down. Those costs can run into tens of thousands of dollars. Product recall insurance covers that. Your standard product liability policy does not.
For most food trucks, product recall insurance is worth considering, especially if you prepare food in batches, distribute to multiple locations, or work with suppliers who could introduce contamination risks outside your control. The cost is typically modest compared to the financial devastation of an uninsured recall.
Coverage Limits and Vendor Requirements
Most event organizers, festival coordinators, commissary kitchens, and corporate clients require food trucks to carry at least $1 million in general liability coverage—which includes product liability. This is the industry standard. You'll need to provide a certificate of insurance proving you have this coverage before they'll sign a contract with you.
Some larger venues go further. Stadiums, major music festivals, and high-profile corporate events sometimes require $2 million or even $5 million in coverage. If you want to work these lucrative gigs, you'll need to meet their requirements. The good news is that general liability insurance is surprisingly affordable for food trucks—typically between $300 and $1,300 per year for basic coverage, or around $44 per month on average.
Many event organizers will also require you to add them as an additional insured on your policy. This means your insurance extends to cover them if they get sued over something related to your food truck at their event. It's a standard request and usually costs nothing extra—just ask your insurance agent to add them when you get your certificate.
Don't skimp on limits to save a few bucks. With the average foodborne illness lawsuit ranging from $50,000 to over $1 million, and considering that foodborne illnesses cost the U.S. $15.6 billion annually, adequate coverage is non-negotiable. A $500,000 policy might save you $200 a year over a $1 million policy, but it could leave you catastrophically underinsured if you face a serious claim.
How to Get the Right Coverage for Your Food Truck
Start by getting quotes for general liability insurance that includes product liability coverage. Most insurers who specialize in food trucks or small businesses will automatically include this. Verify that your policy specifically mentions products-completed operations coverage—it should be listed in your policy documents.
When comparing policies, pay attention to the per-occurrence limit and the aggregate limit. The per-occurrence limit is the maximum your policy will pay for a single incident. The aggregate limit is the total amount your policy will pay for all claims during the policy period (usually one year). A typical policy might have a $1 million per-occurrence limit and a $2 million aggregate limit.
Ask about adding product recall insurance as an endorsement. Not every insurer offers it, but those who specialize in food service businesses usually do. Also consider whether you need commercial umbrella insurance, which kicks in when claims exceed your primary general liability limits. Premium clients often require this extra layer of protection.
Finally, make sure your policy covers all the venues where you operate. If you serve customers in multiple states or jurisdictions, confirm your coverage extends to all those locations. Keep copies of your certificate of insurance readily available—you'll need to provide them constantly to event organizers, venue managers, and clients.
Running a food truck is rewarding but risky. Product liability insurance protects your business from the financial devastation of a lawsuit when something goes wrong with your food. It's affordable, it's required by most venues worth working at, and it gives you peace of mind that one sick customer won't destroy everything you've built. Get proper coverage, maintain it, and focus on what you do best—feeding hungry people great food.
