Food allergy incidents are among the most serious claims restaurants face. Allergic reactions can range from mild discomfort to life-threatening anaphylaxis, and the resulting lawsuits can be substantial. Understanding how general liability insurance responds to allergy claims - and where coverage gaps exist - helps you protect your restaurant and your customers.
The Rising Risk of Food Allergy Claims
Food allergies affect approximately 32 million Americans, and the prevalence is increasing. For restaurants, this means:
- More customers disclosing allergies when ordering
- Higher expectations for allergen management
- Greater legal exposure when mistakes happen
- More sophisticated plaintiffs' attorneys specializing in allergy cases
How General Liability Covers Allergy Claims
Food allergy claims typically fall under the 'products liability' or 'completed operations' portion of your general liability policy. Coverage includes:
- Bodily injury: Medical expenses, hospital stays, ongoing treatment for allergic reactions
- Legal defense: Attorney fees, expert witnesses, court costs to defend against allergy lawsuits
- Settlements and judgments: Amounts paid to resolve claims, up to your policy limits
- Wrongful death: In tragic cases where allergic reactions prove fatal
Common Allergy Claim Scenarios
1. Customer Discloses Allergy, Kitchen Makes Error
Scenario: A customer tells the server about a peanut allergy. The server notes it, but the kitchen uses peanut oil. The customer has a severe reaction.
Coverage: Likely covered. Your GL policy responds to bodily injury claims arising from your operations, including kitchen errors.
Risk factors: Documentation of the disclosure, staff training records, and allergy protocols will be scrutinized during litigation.
2. Hidden Allergen in Recipe
Scenario: A customer with a sesame allergy orders a dish. The menu doesn't mention sesame, but the house sauce contains sesame oil. The customer reacts.
Coverage: Likely covered, but liability is clearer against the restaurant since no disclosure was made and the menu didn't warn of the allergen.
3. Cross-Contamination
Scenario: A customer orders a gluten-free dish. The kitchen prepares it on a surface contaminated with wheat flour. The customer with celiac disease becomes seriously ill.
Coverage: Covered, but these claims often hinge on whether cross-contamination was preventable and what protocols were in place.
What Affects Claim Outcomes
Several factors determine how allergy claims are resolved and how they affect your insurance:
Documentation and Communication
- Was the allergy clearly communicated by the customer?
- Did your staff document the disclosure?
- Was the information transmitted accurately to the kitchen?
Training and Protocols
- Do you have written allergy management procedures?
- Are staff trained on allergen identification and prevention?
- Do you maintain training records?
Menu Transparency
- Does your menu identify common allergens?
- Do you have allergen information available upon request?
- Are customers warned about cross-contamination risks?
What General Liability Doesn't Cover
- Known defects: If you knowingly serve allergens after a customer discloses their allergy, coverage may be denied for intentional acts
- Regulatory fines: Health department penalties for allergen mismanagement aren't covered
- Product recalls: If you need to recall food products, that's typically not covered under standard GL
- Reputational damage: Lost business after an allergy incident isn't covered
Risk Management for Allergy Claims
- 1.Implement written allergy protocols: Create clear procedures for handling allergy disclosures, from front-of-house to kitchen
- 2.Train all staff regularly: Servers, hosts, and kitchen staff should all understand allergen risks and protocols
- 3.Document everything: Keep records of training, allergy requests, and any incidents
- 4.Review your menu: Consider adding allergen information or at minimum, a statement asking customers to inform staff of allergies
- 5.Maintain separate prep areas: Where possible, designate allergen-free preparation zones
Frequently Asked Questions
Does my GL policy cover 'gluten-free' or 'allergen-free' menu claims?
Yes, but be careful with absolute claims. If you market items as 'allergen-free' and cross-contamination occurs, you've created clear liability. Many restaurants now use 'gluten-friendly' or 'prepared without gluten' language to manage expectations.
What if the customer didn't tell us about their allergy?
If the customer didn't disclose their allergy, your liability is significantly reduced but not eliminated. Courts may consider whether common allergens were disclosed on the menu or if the restaurant had reasonable opportunity to warn customers.
Are fatal allergy cases covered?
Yes. Wrongful death claims arising from allergic reactions are covered under general liability, subject to your policy limits. These claims can be substantial - limits of $1 million or more are strongly recommended.