Cottage Food Law
Cottage Food Laws are state regulations that allow individuals to produce and sell certain low-risk food products, like baked goods, jams, and dry mixes, from their home kitchens without a commercial food license. They typically impose revenue caps (often $15,000 to $50,000 annually) and restrict where products can be sold, and they do not permit restaurant-style service.
What You Need to Know
Cottage food laws only permit low-risk, shelf-stable products. Anything requiring refrigeration, canned low-acid foods, dairy, and meat, poultry, or seafood are prohibited and require commercial licensing instead.
Cottage food vs. restaurant — a critical distinction:
- Cottage food covers packaged products sold for consumption elsewhere
- A restaurant serves prepared food for immediate consumption on or off premises
- You cannot operate both from the same home kitchen location
- Different licensing and different insurance apply to each model
Many cottage food operators unknowingly violate their exemption by exceeding revenue limits, selling prohibited products, or operating restaurant-style service from home — violations that can trigger health department citations and complete insurance coverage denial.
Why It Matters for Restaurant Owners
Cottage food laws can provide a legal, low-cost pathway to test products and build a customer base before investing in a commercial kitchen or restaurant. But the coverage needs change dramatically once you outgrow the exemption.
You've outgrown cottage food laws when:
- Annual revenue exceeds your state's limit
- You want to sell wholesale to restaurants or retail stores
- You want to hire employees, which most states prohibit under cottage food rules
- You want to serve food on premises, which immediately requires restaurant licensing
Cottage food insurance is simple product liability coverage, while restaurant insurance is comprehensive general liability, property, and workers' comp coverage. Misrepresenting your business status — continuing to claim cottage food status while operating restaurant-scale — can void your insurance entirely.
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Tell us your concept, your coverage questions, and your state — and we'll put together the coverage that actually applies.
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