How to Insure a Bakery in New Jersey

While people across the country love baked goods, New Jersey residents seem to have an extra special fondness for them. New Jersey has tons of bakeries that cater to many different ethnicities and palate preferences, and the industry overall makes about $3 billion annually in the US. With such a huge market, it’s all the more important for bakery owners in New Jersey to get set up with the right kind of bakery insurance coverage for their unique business’s needs.

What Does Bakery Insurance Cover in New Jersey?

Bakery insurance is essentially a special type of business insurance customized to protect owners of bakeries in New Jersey, similar to how it would be anywhere else in the country. The agreement between the insurance company and the bakery states that the insurer will cover financial losses that befall the bakery and/or its owner. Of course, only specific perils stated in the policy will be covered by the insurance company. Each policy comes with a list of non-covered perils as well.

How to Insure a Bakery in New Jersey

The thing about bakery insurance coverage is that one policy won’t work for every type of bakery or each specific business owner. With the help of your New Jersey independent insurance agent, you’ll work together to assemble a package of different coverages to protect you and your business against risks unique to you. Bakery insurance is designed to keep your business afloat following a huge disaster such as property destruction or lawsuits.

Your independent insurance agent will help identify the right types of coverage for you as they learn more about your specific bakery and its operations. Since bakery insurance is so customizable, you’ll be able to work together to build a policy that fits not only your business’s needs, but also the needs of your bank account.

What Does Bakery Insurance Cover in New Jersey?

Bakery insurance is set up to protect business owners against potential threats. This includes bakeries in New Jersey. Your policy will include the basics of business insurance coverage, with several specific coverages tailored to your unique bakery business added on. The more risks involved in your business, the more coverage you’ll need. But here are a handful of commonly selected coverages in bakery insurance packages to start off.

Your bakery insurance package can be assembled from a combination of the following coverages available in New Jersey:

• General liability: This coverage protects you against property damage or injury claims made by a third party. 
• Workers’ compensation: If your employees become ill, get injured, or die from a work-related incident, this aspect of bakery insurance will cover the financial ramifications. This coverage is mandatory in New Jersey. 
• Property Insurance: Covers loss of or damage to your physical property including your bakery’s storefront and often the inventory inside it. Protected mishaps include fires, storms, and more.
• Commercial/business auto: Provides protection for any company vehicles against things like theft, vandalism, and damage from natural disasters. If your bakery makes home deliveries, for example, you need this coverage.
• Business income: A part of property insurance, this bakery insurance aspect covers the financial loss suffered while the business is closed due to fire damage or other disasters.
• Disability insurance: Businesses in New Jersey are required by law to purchase this coverage for their employees to protect them in the event they become disabled due to workplace conditions or operations.
• Unemployment insurance:  Your business will automatically be buying mandatory New Jersey unemployment insurance as soon as you, the owner, start officially paying state taxes if your bakery has any employees.
• Utility interruption: In the event of an extended power outage or other catastrophe, your business’s operations may be slowed or even suspended. This coverage provides compensation for lost income during these periods as well as for damage caused to your property by the covered catastrophe.
• Cyber liability: In the event your bakery’s computer system is compromised, sensitive or personal data may be stolen and even sold to third parties. This can include things like credit card numbers or personal employee records. Aside from having to pay to clean up your network’s security, your bakery could also face a lawsuit. Coverage protects against financial and legal ramifications following a cyberattack.
• Employment practices liability: Covers fees for lawyers and other financial ramifications if any of your employees are involved in harassment cases against coworkers or customers.
• Boiler & machinery: Also known as "equipment insurance," it covers electric equipment in the building (e.g., AC units and boilers) that breaks down due to power surges, etc. Property insurance may cover this stuff, but not always.
• Product recall coverage: If you’ve ordered a bad batch of ingredients that is later recalled, this coverage will take care of the financial losses associated with ordering replacements. This aspect can also include any expensive PR coverage fees related to the recall.
• Communicable disease: Covers any illnesses transmitted to customers due to improper hygiene of your employees.

Your bakery insurance package will be assembled by selecting the coverages that work for your unique business from a big list of available options in New Jersey. Coverage applies to everything from lost business revenue to potential legal/court fees and beyond.

What Does Bakery Insurance Not Cover in New Jersey?

Though bakery insurance covers a lot of components necessary for business owners in New Jersey, it doesn’t cover just anything. The following are examples of commonly excluded perils under bakery insurance policies in New Jersey:

• Employee dishonesty
• General wear and tear of equipment, etc.
• Routine maintenance fees
• Earthquake damage
• Nuclear reaction and war
• Power failure (unless it causes damage to computer systems)
• Robbery
• Pollution
• Temperature/humidity changes
• Inexplicably lost inventory
• Flood damage*

*In a state like New Jersey that’s prone to flooding, you’ll most likely want to purchase additional flood coverage for your bakery, or you may even be required to have it by your mortgage lender. Your New Jersey independent insurance agent can give you more information about finding coverage to add to your bakery insurance package.

What Are the Benefits of Bakery Insurance in New Jersey?

Bakery insurance provides protection to New Jersey business owners in a number of ways. Beyond the bakery’s physical assets and building, many components of your business stand to be destroyed or otherwise harmed by common threats. There are four major benefits to having bakery insurance in New Jersey:

• Protection against legal trouble: A costly and damaging event like a fire could send a business into the red without the proper coverage. If the business was unable to pay off their loans, vendors, or employees, they could face serious legal consequences in New Jersey. Bakery insurance helps prevent these ugly matters from surfacing.
• Protection against a damaged reputation: Huge incidents affecting bakeries and other businesses can sometimes end up in the media. When it comes to customers’ personal property getting lost, damaged, or destroyed, or even someone becoming ill, word about their upset could spread quickly or turn from gossip into media coverage. Having the right bakery insurance can help prevent your business’s reputation from going up in flames.
• Protection against spoilage: For a bakery, inventory is comprised almost entirely of food and other perishables, and just one incident can ruin the entire stock. Bakery insurance coverage can help the business recover from lost goods.
• Protection against bankruptcy: Imagine a severe storm or other terrible incident like an airplane crash that literally wipes out your bakery entirely. Without the right insurance, a business owner could easily be forced into bankruptcy in New Jersey. Bakery insurance helps businesses stay open, stay afloat, or rebuild following massive destruction.

Your New Jersey independent insurance agent can help you review your bakery insurance policy to answer any remaining questions about your coverage. They’ll also be able to help you figure out whether you’ve got enough coverage or if you should purchase more.

How Much Does Bakery Insurance Cost in New Jersey?

Really, it depends on a number of factors. Bakery owners might pay somewhere in the low thousands annually if they run a small, stand-alone shop that faces relatively few risks, while large bakery chain cafés or bakeries located with giant chain grocery stores might pay up into the ten thousands or even much more per year.

That being said, bakeries located in New Jersey might pay quite a bit more for bakery insurance coverage than business owners further inland, due to the state’s increased risk of weather-related perils. Businesses in New Jersey, including bakeries, face a higher threat of flood or hurricane damage than in many other states.

Of course, it’s hard to offer an average figure since each bakery is unique. But really, it all depends on a number of factors, like:

• The type of bakery: This involves more than just whether the bakery sells nothing but cutesy pastries or specialized Greek/Cuban/Viennese/French/etc. treats. The kind of equipment your bakery uses and the specific operations taking place will affect its risk-level to insure. Obviously, more danger means more money for bakery insurance.
• The location of the bakery: Larger cities tend to have higher costs for bakery insurance, but it goes beyond that. Depending on where you are specifically in New Jersey, your location may be more prone to various weather-related risks. Bakeries right along the Jersey Shore, for example, may have premiums up to 20% higher due to risk of hurricane damage.
• The number of employees: The more you've got, the more workers' comp you’ll need. Simple as that.
• How much business you generate: Premiums are calculated based on business projections for the upcoming year. If your workload doubles, most likely your premium will too.

Your agent can work with you to find a bakery insurance policy that fits within your bakery’s budget. Have your financial restrictions in mind before you start shopping for coverage to help speed the process along.

Why Work with a New Jersey Independent Insurance Agent?

In order to get the protection you need and deserve, you’ll want to work with a trusted expert. And who could be better for the job than a local agent who shares your area code? Independent insurance agents act as your own personal insurance shoppers, offering you tons more options than one-policy companies. With just one call, they’ll hook you up with multiple quotes.

New Jersey independent insurance agents are armed with knowledge on what coverage is needed in your area, and they’ll get you set up with just enough of it — not too little, not too much. They’ll handle all the heavy lifting so you can rest assured you’ll be set up with the right coverage at the right price.

They’re not just there at the beginning, either. If disaster strikes, your New Jersey agent will be there to help walk you through the claims process and make sure you’re getting the benefits you're entitled to. Now that’s thinking ahead.