How to Reduce Premiums & Manage Risk in Food Manufacturing

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Practical, insurer-friendly steps to cut claims, improve compliance, and reduce the cost of food & beverage manufacturing insurance in the UK.

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We compare quotes from leading insurers

  • Allianz
  • Aviva
  • QBE
  • RSA
  • Zurich
  • NIG

LOWER PREMIUMS START WITH BETTER RISK CONTROLS

Why Food Manufacturing Insurance Premiums Change

Insurance premiums for food and beverage manufacturers are driven by the likelihood of claims and the potential size of losses. Insurers look at your process risks (hot work, oils, dust, refrigeration, machinery), your product risk (allergens, chilled/frozen, vulnerable consumers, retailer supply), and the quality of your controls (HACCP maturity, traceability, training and maintenance).

The good news is that many of the biggest rating factors are within your influence. By improving risk controls and documenting them clearly, you can often reduce premiums, increase available cover limits, and avoid exclusions. This page explains practical steps that insurers recognise - and how to present them in a way that gets you the best terms.

What Insurers Look At When Pricing Food Manufacturing Insurance

Most food manufacturing policies are built from several components: property (buildings/contents/stock), business interruption, employers’ liability, public/product liability, equipment breakdown, and often product recall/contamination. Your premium is effectively a reflection of the combined risk profile across these areas.

Underwriters typically focus on:

  • Fire risk – ignition sources, hot processes, electrical load, housekeeping, and compartmentation.
  • Product risk – allergen exposure, chilled/frozen distribution, high-risk ingredients, vulnerable consumers.
  • Traceability & QA – HACCP, CCP monitoring, mock recalls, supplier approvals, audit trails.
  • Claims history – frequency and severity of incidents over the last 3–5 years.
  • Contractual exposure – retailer requirements, penalties, and broad indemnities in supply contracts.
  • Equipment dependency – single points of failure such as chillers, compressors, boilers, control panels.
  • Risk culture – training, supervision, maintenance regimes, and near-miss reporting.
  • Site and storage – layout, separation, stock values, and security arrangements.

1) Reduce Fire Risk (The Biggest Premium Driver)

Fire losses in food manufacturing can be severe because of high heat processes, electrical load, dust/oil residues, and packaging storage. Insurers often treat fire risk as the primary driver of property and business interruption premiums - especially if you have high stock values or limited separation between production and storage.

Insurer-friendly improvements include:

Fire prevention and containment

  • Improve housekeeping – minimise dust, oils, and waste accumulation around ignition sources.
  • Electrical inspection – periodic EICR checks, thermal imaging, and load monitoring.
  • Separate high-risk areas – compartmentation between production, storage, plant rooms, and waste areas.
  • Control hot works – permits, supervision, and fire watch procedures.
  • Manage cooking oil hazards – fryer cleaning routines, extraction maintenance, suppression where needed.
  • Store packaging wisely – limit quantities in production areas and store bulk packaging in lower-risk zones.

Fire protection that insurers value

  • Automatic fire alarms with monitoring to a 24/7 alarm receiving centre.
  • Sprinkler protection (where feasible) - often a major pricing lever.
  • Extinguishers and staff training – documented training and inspection records.
  • Emergency response plan – drills, muster points, and key contact lists.
  • Isolation and shut-down procedures – clear controls for process equipment and utilities.
  • Arson and waste controls – secure external bins and keep waste away from buildings.

Even if you can’t install sprinklers immediately, insurers often respond positively to incremental improvements such as monitored alarms, enhanced compartmentation, improved extraction maintenance, thermal imaging, and strict hot works control. What matters is that you can demonstrate these controls clearly at renewal.

2) Strengthen Product Safety (Allergens, Contamination & Labelling)

Product claims and recalls are among the most expensive events a food business can face. Insurers look closely at your HACCP system, allergen management, cleaning validation, and labelling controls. If you supply retailers, they may also expect evidence of mock recall testing and robust traceability.

Allergen and cross-contact controls

  • Segregation plans – physical separation and process controls for allergens.
  • Validated cleaning – evidence that cleaning removes allergen residues effectively.
  • Dedicated equipment where feasible for high-risk allergens.
  • Line changeover checklists – signed QA release procedures.
  • Label version control – prevent outdated artwork being used.
  • Finished goods checks – routine label verification and coding checks.

Traceability and recall readiness

  • Mock recalls at least annually, with documented speed and completeness.
  • Batch coding clarity and a robust “hold and release” process.
  • Supplier approval with ongoing monitoring and testing where needed.
  • Complaint trending and corrective action tracking (CAPA).
  • Environmental monitoring (where relevant) for microbiological risk.
  • Vulnerability assessments for authenticity and fraud risks (where relevant).

When renewals are difficult, it’s often because insurers can’t see how you control allergen and labelling risks. Having a concise “risk pack” ready (HACCP overview, allergen matrix, mock recall report, audit status, and key SOPs) can materially improve terms.

3) Prevent Downtime: Maintenance, Refrigeration & Single Points of Failure

Equipment breakdown and refrigeration failures can create expensive losses - including spoilage, missed deliveries, overtime, and reputational harm. Insurers want to see that critical equipment is maintained, monitored, and backed up where possible.

Maintenance and inspection

  • Planned preventive maintenance (PPM) with logs and proof of completion.
  • Condition monitoring – vibration checks, oil analysis, and thermal imaging.
  • Critical spares list with lead times and suppliers.
  • Engineer call-out plan for out-of-hours breakdown response.
  • Guarding and safety checks to reduce injury incidents (also helps EL).

Cold chain controls

  • Temperature monitoring with alarms and escalation procedures.
  • Maintenance contracts for refrigeration plant and cold rooms.
  • Redundancy – backup capacity for critical chillers/freezers where feasible.
  • Door discipline and rapid repair processes for cold store integrity.
  • Stock rotation and segregation to limit spoilage impact.

One of the best ways to reduce premiums is to demonstrate that you understand your “single points of failure” and have a plan for them. Even where redundancy isn’t possible, insurers respond well to monitoring, rapid call-out, and documented contingency planning.

4) Reduce Employers’ Liability Claims (Workplace Injuries)

Employers’ liability (EL) claims can creep up over time and steadily increase premiums. Food manufacturing environments involve repetitive tasks, wet floors, forklifts, sharp tools, hot surfaces, and cleaning chemicals - all of which can lead to claims if controls slip. Strong EL controls can reduce claim frequency and improve insurer confidence.

High-impact EL controls

  • Manual handling programme – training, refreshers, and workstation design.
  • Slip prevention – flooring, drainage, footwear policy, and washdown routines.
  • Forklift traffic management – segregation, signage, and speed controls.
  • Machine guarding & lock-off – documented checks and isolation procedures.
  • COSHH controls – PPE, safe storage, and staff training for chemicals.
  • Near-miss reporting – shows proactive safety culture.

When insurers review EL risk, they often want to see evidence: training logs, RAMS, accident records, and corrective actions. Having a simple “safety pack” available for renewals can help you negotiate better terms.

5) Improve Security & Reduce Theft Exposure

Theft and malicious damage can affect both property pricing and business interruption. For manufacturers with valuable stock, branded ingredients, alcohol, or easily-resold goods, security is a key underwriting theme.

  • Monitored intruder alarm with police response where applicable.
  • CCTV coverage of entrances, loading bays, and stock areas.
  • Access control – visitor logs, restricted zones, staff badges.
  • Perimeter security – gates, lighting, and physical barriers.
  • Key management – controlled issue and tracking of keys/fobs.
  • Stock control – reconciliation, shrinkage checks, secure cages for high-value items.

6) Present Your Risk Better at Renewal (Often the Fastest Win)

Two businesses can have similar risk profiles, but one pays significantly more because the insurer can’t see the controls. A clean submission, clear evidence of risk management, and early renewal preparation can materially improve pricing.

Practical steps that often reduce premiums:

Build a “renewal risk pack”

  • Site overview – processes, layout, and key controls.
  • Fire risk summary – alarms, monitoring, housekeeping, compartmentation.
  • Maintenance evidence – PPM logs, refrigeration service schedules.
  • Food safety pack – HACCP overview, allergen matrix, traceability demo, mock recall report.
  • Claims narrative – what happened, what changed, and prevention actions.
  • Photos – tidy production areas, plant rooms, and protected storage zones.

Timing and negotiation tips

  • Start early – ideally 6–10 weeks before renewal for complex risks.
  • Document improvements made since last renewal.
  • Review sums insured – avoid over-insurance and ensure accuracy.
  • Agree realistic BI indemnity and maximum loss scenario.
  • Consider sensible excesses if cashflow allows.
  • Remove uncertainty – insurers price uncertainty heavily.
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7) Structure Your Cover to Avoid Paying for the Wrong Things

Premium reduction isn’t only about risk controls - it’s also about the structure of the policy. Many manufacturers inadvertently inflate premiums through inaccurate sums insured, unrealistic BI settings, or unnecessary extensions. Conversely, stripping cover too far can create dangerous gaps.

Areas to review with your broker:

  • Buildings and contents valuations – ensure insured values reflect reality (and rebuild costs).
  • Stock values – consider peak season and maximum stock at risk.
  • Business interruption – pick realistic indemnity periods for your supply chain and lead times.
  • Excess selection – higher excess may reduce premium if you can absorb small losses.
  • Liability limits – align with retailer contracts and distribution footprint.
  • Recall/contamination – ensure triggers and limits match real exposures.
  • Equipment breakdown – insure critical plant properly and consider spoilage extensions.
  • Contractual liability – don’t accept broad indemnities without matching insurance.

Why Insure24 Helps Reduce Premiums

Insure24 doesn’t just “shop a premium”. We help you make your business more insurable by identifying the highest-impact improvements, documenting them properly, and approaching insurers that understand food and beverage manufacturing risks.

If you’ve seen large increases at renewal or insurers have imposed restrictions, we can help by:

  • Reviewing your risk profile and identifying “premium drivers”
  • Recommending quick wins and longer-term improvements
  • Helping you compile a renewal risk pack that underwriters trust
  • Comparing insurers and negotiating on cover, excess, and terms
  • Ensuring your policy structure matches your operations and contracts
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FREQUENTLY ASKED QUESTIONS

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Why did my food manufacturing insurance premium increase?

Premiums can increase due to claims history, sector-wide loss trends, changes to your turnover or stock values, fire risk factors, insurer appetite, or uncertainty about risk controls. Improving controls and presenting them clearly can often reduce costs at renewal.

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What’s the fastest way to reduce premiums?

Often, the fastest win is improving your renewal submission: provide clear evidence of fire protection, maintenance, HACCP controls, claims improvements and site photos. Insurers price uncertainty heavily, so a stronger presentation can improve terms quickly.

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Do sprinklers always reduce insurance premiums?

Sprinklers are often viewed very positively by insurers and can improve pricing and availability, but outcomes vary by insurer and risk profile. Even without sprinklers, improvements like monitored alarms, compartmentation, and strong housekeeping can still help.

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How can I reduce product liability and recall risk?

Focus on allergen segregation, validated cleaning, label controls, supplier assurance, traceability, and mock recalls. Demonstrating these controls can reduce risk and improve insurer confidence when underwriting liability and recall/contamination cover.

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Does improving maintenance reduce insurance costs?

It can. Documented planned preventive maintenance, refrigeration servicing, and monitoring (like temperature alarms) can reduce losses from breakdown and spoilage and can improve insurer appetite for equipment breakdown and stock covers.

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Should I increase my policy excess to lower premium?

Increasing excess can reduce premium, but only if your cashflow can absorb smaller losses. It’s best considered alongside risk controls, claims frequency, and your tolerance for uninsured costs.

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How do I avoid being over-insured?

Review building rebuild costs, contents replacement values, maximum stock at risk, and BI gross profit carefully. Accurate sums insured help you avoid paying for cover you don’t need, while still protecting you properly in a loss.

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Does certification (BRCGS/SALSA) help reduce premiums?

Certification can improve insurer confidence because it suggests stronger systems and audit discipline, but it won’t guarantee lower premiums. The biggest benefit is often improved availability of cover and better terms when paired with strong fire and maintenance controls.

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How early should I start my renewal?

For many manufacturers, starting 6–10 weeks before renewal is sensible, especially if your risk is complex or you’ve had claims. Early preparation allows time to gather evidence, approach multiple insurers, and negotiate terms.

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Can Insure24 help if insurers are refusing to quote?

Yes. Where insurers are hesitant, we can help present your risk more effectively, highlight controls, and approach markets with relevant appetite. We’ll also advise on practical improvements that can reopen insurer options over time.

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