protecting you


 protecting your business 

insurance for artisan, small-batch and cottage-industry food producers  

There is a growing demand for what used to be called 'cottage industry' foods - food items such as jams and jellies, sauces and pickles, juices, power drinks, smoothies, baby food, specialty teas, breads and baked goods, desserts, cakes and pastries, specialty foods, ethnic foods, rotis and curries, dried or smoked goods, handmade pastas, spice blends ... the list goes on and on!  Since Canada is so ethnically diverse, many have brought foods from their home countries to supply their communities here in Canada, and to introduce their foods and culture to other Canadians.

This group of entrepreneurs mostly sell directly to consumers - through word-of-mouth, through local advertising, and their own websites.

government regulations

Some entrepreneurs who are new to the industry think they can cook in their home kitchen.  Your local government may require that your home kitchen be retrofitted to meet health standards, or they may require that you have an independent kitchen set up in your home that is solely used for your business (i.e. not personal, home cooking).  This can be costly, especially if you have to have to create a new kitchen space.  An alternative is to use a commercial kitchen that rents by the hour or by the day.  We have partnered with many commercial kitchens and incubator kitchens etc. across Canada and will be happy to make a referral wherever possible.

home insurance

If running your business from a home office, rather than a formal office space, your home insurance company will need to be notified, otherwise any claims made may not be honoured, leaving you to pay for the costs relating to the claim out of your own pocket.  If you get approval from your local government for a 'commercial' kitchen in your home, then again, your home insurance company should be notified.  Your rates will very likely increase as a result of the additional risk.

rental agreements and tenancy agreements

If you are renting your home and running it from a home office, you should also check your tenancy agreement and notify your landlord, as there may be terms in your tenancy agreement that prohibit business operations; ignoring this could result in you being evicted or sued by your landlord.

commercial general liability insurance

Commercial General Liability Insurance is a must for anyone preparing food commercially.  It protects you and your finances should there be a claim from someone consuming your food; it also protects should a claim arise from clients coming to your home for business-related meetings or to pick up food.  Without it, you will be personally liable for your legal fees and all the costs of a successful claim.  Having it protects your hard-earned income and gives you peace of mind.  This is where Chef Insurance comes in, and our Success Managers are always ready to assist and answer your questions.

accounting and tax considerations

Your accountant can advise you on how to set up your business to take advantage of tax rules relating to business expenses.  You should also discuss the best way to set up your business (e.g. a sole proprietorship, a corporation etc.) to declare income, whether you need to charge sales tax etc.  Remember, it is a crime to earn income, including tips, without declaring it to Canada Revenue Agency (CRA), and there can be serious consequences for doing so.  Being convicted of tax evasion can also lead to fingerprinting, court imposed fines, jail time, and a criminal record. When taxpayers are convicted of tax evasion, they must still repay the full amount of taxes owing, plus interest and any civil penalties assessed by the CRA.

Food safety

There are many practices that are OK for a home-cook preparing food for their own family that are not OK when preparing food for sale.  If you have not already done so, you should enrol in a course to get up-to-date food safety training.  After all, anyone working with food can have a serious effect on the health and wellbeing of those consuming the food - it could be a matter of life and death.  Being armed with the necessary knowledge of how to handle food correctly, is essential to any foodservice business.

The Chef Alliance is a leading foodservice association in Canada offering Chefs and Entrepreneurs a place to grow their business.  They can benefit from liability insurance to protect their clients and finances, peer support strengthen their business, discounts to lower their business costs, market their services and increase profits.  This leaves them time to concentrate on what they do best - cook great food!​​