Support the booth and the business: Layered coverage for growing farmers market vendors

Many markets may require vendors to carry general liability insurance, usually $1M per occurrence and $2M aggregate, which are commonly requested limits, although requirements may vary. Homeowners or personal insurance usually won’t suffice; vendors will often need a commercial general liability (CGL) policy in place. Ensure that their coverage limits meet or exceed the market requirements and are active through the entire season, so that they may meet contract requirements. If limits fall short, consider whether higher limits or excess coverage are appropriate based on the risk.

Two vendors selling similar products can have dramatically different layouts, production methods, and distribution footprints—all of which affect underwriting decisions. For vendors selling food, soaps, candles or other handmade goods, product liability coverage may be an important consideration. Claims may occur away from the booth and after purchase, meaning even small-batch makers can face potential claims from allergic reactions, foodborne illness or product defects. Underwriters can look for indicators of care and consistency, such as recipes, labeling practices and production volumes, to inform the risk level.

From tents and tables to inventory and mobile equipment, the risks for vendors go beyond the products. Premises liability at the booth, offsite consumption or use of products and evolving operations are all necessary considerations. Think about whether their policy reflects any updated values for new purchases, coverage for items in transit and at offsite events (which may warrant consideration of an inland marine or business property floater). Also consider coverage for money, POS systems and cyber liability, especially if they accept digital payments. Many vendors can underestimate the full value of their mobile storefront, with business personal property (BPP) values that don’t reflect what’s transported each weekend.

Key casualty exposures, like premises liability and slip/trip hazards, may be present at many types of markets. Setup and equipment hazards should be considered as well when charting potential interactions at the booth. For certain products or vendors, completed operations liability coverage may be relevant depending on the exposure. Be aware of participation in multiple markets, as there may be different requirements for different municipalities, as well as events held in high-traffic areas like parks and recreational centers for potential exposures. These types of locations may present indicators of loss potential, from booth setup to crowd flow and customer interaction risks.

In many cases, markets will require vendors to provide a COI listing the event as an additional insured. Help your clients understand their COIs and how to request a new one, as well as confirming that additional insured requirements are addressed in the policy documents. Keeping digital and printed copies available is important, but accuracy is the key priority—double-check event names and timeframes are correct and up to date to avoid delays or denied entry.

Vendors aiming to turn their side hustle into a main source of income tend to grow into more complex operations. This kind of growth is gradual, which means coverage can fall behind. Online sales, retail or wholesale distribution and year-round production all help your clients’ businesses expand, but they also bring new exposures. As their business grows, insurance coverage may need to evolve or reflect changes such as higher liability limits, expanded property coverage for equipment breakdown and coverage for stored goods (whether at home or in a warehouse).