Restaurant Insurance in Texas: Cost, Coverage & Requirements (2026 Guide)

Opening or operating a restaurant in Texas comes with real risks from customer injuries and kitchen fires to lease requirements and SBA loan conditions. Restaurant insurance in Texas is designed to protect restaurant owners financially while meeting landlord, lender, and regulatory requirements.

At Aqua Tree Insurance, we help restaurant owners across Texas structure the right coverage, not just the cheapest policy, so they can operate with confidence.

What Is Restaurant Insurance in Texas?

Restaurant insurance is a package of commercial coverages designed to protect Texas restaurant owners from lawsuits, property damage, employee injuries, and business interruptions.

In Texas, restaurant insurance is commonly required by:

• Landlords (lease agreements)

• SBA and commercial lenders

• City permits and licenses

• Franchisors

Most Texas landlords require proof of insurance before keys are released.

How Much Does Restaurant Insurance Cost in Texas?

Average Monthly Cost in Texas

Most restaurants in Texas typically pay:

• $120 – $250 per month for basic coverage

• $200 – $600 per month for full-service or higher-risk operations

Factors That Affect Cost in Texas

• Type of restaurant (limited vs. full service)

• Cooking equipment (deep fryers, grills, open flame)

• Alcohol sales

• Square footage

• Claims history

• Location within Texas

Texas restaurants with alcohol, fryers, or late hours usually pay more due to higher liability exposure.

How Much Is $1,000,000 General Liability Insurance in Texas?

A $1 million general liability policy in Texas typically costs:

• $45 – $110 per month when bundled as part of a Business Owner’s Policy (BOP)

• More if purchased as a standalone policy

Most Texas landlords require:

• $1M per occurrence

• $2M aggregate

• Landlord listed as Additional Insured

What Insurance Do Restaurants Need in Texas?

If you are opening a restaurant in Texas, especially with financing, most lenders require proof of coverage that meets strict guidelines. You can review common SBA loan insurance requirements to understand what policies are typically required before funding or lease approval.

Most Texas restaurants need:

General Liability Insurance

Covers:

• Customer slip-and-fall claims

• Food-related illness claims

• Third-party property damage

Commercial Property Insurance

Covers:

• Kitchen equipment

• Furniture

• Inventory

• Tenant improvements

Many Texas landlords require tenants to insure their own build-out.

Business Interruption Insurance

Pays lost income if your restaurant temporarily closes due to:

• Fire

• Water damage

• Other covered losses

Workers’ Compensation Insurance (Texas-Specific Note)

Texas does not legally require workers’ compensation, but:

• Many landlords require it

• Many lenders require it

• It protects owners from employee lawsuits

Most Texas restaurant owners choose to carry it.

Restaurant insurance requirements may vary depending on your location and operations. For official guidance on commercial insurance rules, you can reference the Texas Department of Insurance, which oversees insurance regulations statewide.

Do Texas Restaurants Need Insurance for Uber Eats or DoorDash?

Yes. Even delivery-only or pickup-focused restaurants in Texas still need:

• General liability insurance

• Product liability coverage

• Commercial property insurance (if equipment is owned)

Third-party delivery apps do not fully protect your business.

What Is the 30/30/30 Rule for Restaurants?

Many Texas restaurant owners reference the 30/30/30 guideline, a commonly used financial benchmark in restaurant operations:

• 30% food cost

• 30% labor

• 30% overhead (including rent, utilities, and insurance)

Insurance typically represents 3-6% of total revenue, depending on the restaurant’s size, operations, and risk exposure. Actual percentages vary.

Why Is Restaurant Insurance Expensive in Texas?

Common reasons include:

• Cooking hazards and open flames

• Grease fires

• Alcohol exposure

• High customer foot traffic

• Texas weather risks (wind, hail, flooding in some areas)

The goal is proper coverage structure, not simply choosing the lowest price.

How Can I Reduce My Restaurant Insurance Cost in Texas?

• Bundle policies into a BOP

• Use correct class codes

• Report accurate revenue

• Implement risk controls (hood cleaning, safety training)

• Work with an agency that understands Texas underwriting

Get Restaurant Insurance in Texas

Whether you are opening a new restaurant or reviewing your current policy, working with a Texas-based insurance agency makes a difference. You can get a restaurant insurance quote in Texas with Aqua Tree Insurance to ensure your coverage meets landlord and SBA lender requirements.