The Food Liability Insurance Program (FLIP) has released its third annual 2026 Food & Beverage Industry Trends Report, revealing that 81.7% of operators feel confident about their business outlook for the coming year. This optimism persists despite widespread financial pressures, with 63.3% of operators citing food costs as their largest expense increase and 72.1% expecting further food cost increases in 2026.
According to the report, which combines insights from mobile food service operators, U.S. consumer dining habits, and proprietary insurance claims data from 2025, more than 60% of businesses indicated they were able to grow in 2025. Additionally, 42.3% expect their average ticket size to increase in 2026, suggesting continued consumer willingness to spend despite economic pressures.
"Food and beverage operators are entering 2026 with confidence, but that optimism comes alongside real financial pressure," said Daryle Stafford, CEO of Veracity Insurance, parent company to FLIP. "Rising food costs and tighter margins are forcing business owners to be more disciplined in how they plan for growth and protect their operations." The report found that in 2025, 54.6% of operators said rising food and ingredient costs negatively impacted profitability.
Consumer demand remains resilient according to the findings, with just 16% of consumers planning to dine out less in 2026. Spending per meal continues to rise, with more than 97% of consumers willing to spend $10+ per meal, up from 94% last year. This suggests that while price sensitivity may be growing, overall consumer engagement with the food service industry remains strong.
Perhaps most concerning for industry leaders is the insurance claims data showing a notable increase in both activity and severity. Claims increased 32.7% year over year in 2025, with a small number of high-cost incidents driving a disproportionate share of total incurred dollars. The most common claim types were accidents causing damage (23.1%), auto or trailer incidents (16.4%), weather-related claims (14.2%), and fire-related claims (9.7%).
The average payout of all claims was $14,158, with 72% of claims occurring during the summer months. Caterers, food trucks and trailers, and farmers market vendors experienced the highest claim activity. "As claims become less frequent but more expensive, operators face a different risk profile than in prior years," added Stafford. "High-severity events can quickly turn into major financial losses, underscoring the need for proactive risk management and adequate insurance coverage."
The full report includes detailed findings by business type, consumer dining behavior, insurance claims activity, and economic outlooks across the food and beverage industry and is available online at https://www.newmediawire.com. For business leaders, the report highlights the dual challenge of maintaining growth amid rising costs while managing increasingly severe operational risks that could threaten financial stability.
