What insurance is required for a food truck in Maryland?
Food truck insurance in Maryland usually consists of a business owner's policy that includes property insurance and general liability coverage. Consider an umbrella policy to save money.
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UPDATED: Sep 15, 2020
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- While owning a Maryland food truck could potentially be very lucrative, it also poses risks that must be offset or mitigated by various types of insurance
- Food trucks in Maryland must be properly insured as commercial vehicles, but there are other types of insurance that you may need or want to buy
- Saving money on your various food truck insurance products may be possible through a bundled policies discount
Maryland residents and visitors can choose to dine in typical restaurant establishments or to take advantage of amazing weather and views by dining at a food truck restaurant.
If you have an entrepreneurial mindset and wonderful recipes, you may be thinking about opening a food truck business in this state.
While you may be eager to get the ball rolling on your Maryland food services business, you need to carefully research all expenses and risks so that you know what you are getting into.
Because a Maryland food truck business is a commercial vehicle and a restaurant business, you may need to buy several types of insurance in order to comply with state laws and regulations.
It may also benefit your business to buy optional insurance products that can reduce your exposure to many other types of issues. The premium amounts for all required and optional insurance products should be included in the financial projections in your business plan.
As beneficial as insurance products can be for your Maryland food truck business, the premium amounts can erode your overall profitability.
Comparing premium costs from multiple providers is a great way to identify potential savings available, but you also need to consider the benefits associated with bundling your policies.
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Coverage Available for Food Trucks in Maryland
Running a Maryland food truck business exposes you to risks related to driving a commercial vehicle, hiring and managing employees in your food truck, and serving your customers.
You have access to a wide range of insurance products to target these risks, and some of the products may even be required by law or by your food truck lender.
Analyzing the coverage options and requirements can help you to finalize the information in your food truck’s business plan.
Commercial Auto Insurance
Any vehicle on Maryland roads must be properly insured. A private-use vehicle must have liability insurance per state requirements, and there are similar requirements in place for commercial use vehicles.
This type of liability insurance pays for accident-related expenses and other expenses related to the use of your food truck rather than to the business operations, but it does not pay for your own vehicle repairs and other related expenses if you are in an accident.
Hired and Non-Owned Auto Insurance
A Maryland food truck could be owned by the business owner, or it could be rented. If you choose to rent your truck from another party, hired and noon-owned truck insurance is critical to add to your coverage portfolio.
This type of insurance is intended specifically for leased commercial vehicles, and it provides you with the liability benefits that you need to comply with local laws.
While collision insurance is not required by Maryland’s auto insurance laws, food truck owners may need to buy it because of lender insurance requirements.
Regardless of whether it is required or not, collision insurance gives you important benefits that could pay for damages you incur if your own vehicle is affected by a collision only.
A collision is not the only negative event that could affect your Maryland food truck. Comprehensive insurance gives you benefits for your own vehicle when it is damaged by something other than a collision such as:
- a vehicle fire
- bad weather damage
This type of insurance is not a legal requirement, but it may be a lender requirement if you have a vehicle loan on your food truck.
Auto insurance pays for mishaps that may happen while you are driving your food truck in Maryland, but you may also have other risks that are caused by regular business functions.
General business liability is specific coverage that could help you to pay for legal expenses and other liability expenses that you face through business functions, such as food poisoning issues if your food products are not properly refrigerated.
The primary property that your Maryland food truck business owns is the truck itself, but you also own the appliances and equipment in the truck. These items may be covered for losses through a personal property insurance product on your auto insurance coverage.
Some food truck owners also own real estate where the food truck is parked, and this land may be developed with picnic tables, lighting, and more. Real estate property insurance can cover losses related to damage these improvements may be affected by.
If you plan to run your Maryland food truck business entirely on your own, you may not need to buy workers’ compensation insurance. However, if you have any employees in your food truck, these employees could potentially be injured.
Workers’ compensation insurance gives you financial benefits to pay for any expenses your business may be responsible for if an employee is injured while he or she is working for you.
A Maryland umbrella policy is a great way to get the employee insurance that you need when you hire workers, and it also offers numerous other benefits.
Food truck owners in Maryland should examine the benefits associated with buying different types of umbrella insurance policies.
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Bundling Your Maryland Food Truck Insurance
As you can see, there are many benefits associated with buying the right combination of food truck insurance products in Maryland, and some insurance types are even required by law.
Because most food truck owners in this state need to buy several types of insurance, bundling coverage together with a single insurance provider should be considered.
Through bundling, you may enjoy improved financial management and qualify for financial savings through a bundled policies discount.
Several food truck insurance providers offer a bundled coverage discount, so you will need to gather multiple quotes for Maryland food truck insurance to find the best deal.
You may also request coverage for non-bundled insurance to determine if this shopping option will yield more affordable coverage for your business.
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