What percent of sales goes to restaurant insurance?
Published rules of thumb put a restaurant's insurance, every policy combined, at 0.5 to 1.5 percent of sales by one accounting firm's count and 1 to 3 percent by another's. Cafés sit at the low end and late-night bars at the top, and neither band comes from a survey. The edges are the useful part: above 3 percent is usually a higher-risk operation or a program nobody has shopped; below 0.5 percent at a full-service restaurant with a bar usually means something is missing, not a good price.
Where the bands come from
Accounting firms and agencies publish them from their own clients. One accounting firm's 2026 rule of thumb is 0.5 to 1.5 percent of gross revenue for every policy combined. Another's is 1 to 3 percent of total revenue, with cafés at the low end and late-night bars at the top. Neither is a survey, neither says how many restaurants it rests on, and neither separates a multi-unit group from a single store. A band that left out workers' comp would be cleaner, because that line moves with payroll and the claims record rather than with sales, but no published band does.
What the edges usually mean
Above 3 percent, one of two things is usually true. The operation carries more risk than most: late hours, a bar that is most of the sales, or alcohol above 25 to 30 percent of total sales, which is where standard carriers step back, so fewer carriers quote and the price follows. Or the program has not been put in front of other carriers in years. In 2026 most lines came down for an account with a clean record, so a program still climbing is worth a second quote: Why did my restaurant insurance go up this year?
Below 0.5 percent at a full-service restaurant with a bar, the number is more often a sign that the program is thin than that someone found a good price. That is a question for the agent, not a verdict: what is on the program, what is not, and what the missing pieces would cost. The lines that tend to be missing are in The coverages restaurants forget, and the liquor side is in The liquor liability gap.
What the percentage sits next to
The reason a band this wide still matters is the margin it sits beside. The National Restaurant Association's 2026 State of the Industry report puts the median full-service restaurant's pre-tax income at about 2.8 percent of sales, and 42 percent of restaurants were unprofitable in 2025. Nine in ten operators name insurance as a cost challenge. At 1 to 3 percent of sales, insurance is the size of the margin itself, which is why it deserves the same look every year that food cost and labor get.
How to check one store
Take last year's premiums for every policy on one store and divide by that store's sales. Do it store by store rather than for the group, because premiums have floors: one published rule of thumb has an $800,000 store paying only 20 to 30 percent less than a $2 million one, so a small store runs a higher percentage on the same program. The dollar version of the same check is here: What does restaurant insurance cost per location?
Inside the number, workers' comp is the line that moves most from one group to the next, and the experience number is why: What is a good experience mod for a restaurant? A store outside the band in either direction is the one to bring to the agent, with its numbers open.