protecting you


 protecting your business 

insurance for home-cooks  

The growing trend for home-based food businesses seems like a great way to make some extra money, especially when your fiends, family and colleagues keep raving about your amazing cakes, pastries and baked good, jams and chutneys, biryanis, rotis and curries or lasagnes and casseroles etc.  It's easy to call it a hobby, but at the end of the day, a business is still a business - both from a tax standpoint and an insurance and food safety standpoint.  

Before you start or continue on this road it is advisable to do your homework.

government regulations

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.

home insurance

Your home insurance company will need to be notified any time you operate a business from home, otherwise any claims may not be honoured, leaving you to pay for the costs relating to the claim out of your own pocket.  Even if you are making the simplest of dishes, if you damage your home while working or if someone slips and falls while collecting the food that they have ordered, for example, then these may not be covered if your home insurance company was unaware that business was being conducted.

rental agreements and tenancy agreements

If you are renting your home or apartment, you should also check your tenancy agreement and notify your landlord, as there may be terms in your tenancy agreement that prohibit business operations being conducted from the premises; 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.  Food poisoning claims can leave a Home Cook responsible for medical bills and lost productivity.  These events could cost thousands of dollars in medical, legal or replacement costs.  Having it protects your hard-earned income and gives you peace of mind.  This is where Chef Insurance come 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!