Many farmers markets require their food vendors to have insurance to protect the vendor—and the market itself—from claims and losses related to accidents, injuries, or damages that happen during the course of a market.
If you are a larger business, like a restaurant or a food truck, you likely already have business insurance that meets farmers market vendor requirements. If you are a small food producer or a cottage business, working with a farmers market may be the first time you consider getting insured. This guide covers everything you need to know.
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What Is Farmers Market Vendor Insurance?
Farmers market vendor insurance typically refers to the basic commercial general liability coverage that most markets require of vendors. If you sell food of any kind at a farmers market, you may want (or be required to have) additional food-related coverage.
- General liability: A commercial general liability policy covers your business against claims of loss, damage, or injury from customers or third parties. If a market customer trips on one of your market table legs, or an electrical cord running to your booth, your general liability policy would cover you against any resulting claims from the customer.
- Food vendor insurance: A food vendor policy is an extra level of coverage for businesses that sell consumable food to the public. Food vendor insurance protects your business in the case of a foodborne illness or allergic reaction claim from customers. Whether you sell radishes from a farm plot, jams prepared in your home kitchen, or burgers cooked to order, food vendor insurance is a good idea.
Most farmers markets only request that vendors have commercial general liability insurance coverage. But if you are applying to vend at a popular and competitive market, showing proof of an additional food vendor policy can give you an edge with the market organizers. The more coverage you have, the less risk the market is taking by working with you.
Why Farmers Market Vendor Insurance Is Important
Most farmers markets are community-organized events backed by non-profits or community groups. These organizations could be liable for claims resulting from many customer accidents, damages, losses, and injuries during market hours. To limit their liability, many farmers market organizations or host venues require individual farmers market vendors to have separate insurance. Common accidents and occurrences in farmers markets include:
- Foodborne illness: Farmers markets have limited resources for keeping foods at safe hot and cold temperatures. You’re also selling and serving foods in the open air, surrounded by people. So, it can be harder to prevent foodborne illness at market stalls than in a traditional brick-and-mortar location.
- Falls: Farmers markets have lots of tents, umbrellas, tables, electrical cords, and sometimes even cables, generators, and water lines. Popular markets get crowded with customers, which easily leads to trips and falls.
- Auto accidents: It is common to drive vehicles onto market sites to load and unload tents, equipment, and products. At the opening and closing of a market, vehicles and pedestrians can (and often do) collide.
Most farmers market organizers will ask to see proof of general liability coverage before approving you to rent booth space. Larger markets may require that you list the market itself as an additional insured on a certificate of insurance. So, farmers market vendor insurance is your ticket to working with markets at all.
Farmers Market Vendor Insurance Specialty Coverages
Depending on the products you sell and the equipment you use, you may want to purchase further coverages for your farmers market vending business. These types of coverages are typically not required by farmers markets themselves, but if you are insuring your food production business to sell at farmers markets, these related coverages can expand to cover your entire business operation.
Extending coverage will protect your business, not just the customers you do business with:
- Farm policy: Large farm operations likely already have coverage for their farm. But if you sell eggs from chickens you house at a private residence, or a glut of raspberries, or other produce from a residential garden, your homeowners insurance does not cover you for customer claims of injuries or illness. Even just a couple of chickens could constitute a “farm” in your insurer’s eyes.
- Food spoilage: Food spoilage coverage is typically an additional clause that can be added to a more general business insurance policy. This protects your business in the event of losses like a loss of power that causes your inventory to spoil.
- Inland marine: Inland marine insurance covers any equipment while in transit. If you transport a gas grill and generator to prepare food at your market booth, inland marine coverage will protect that equipment as you move it from one location to another.
- Commercial property: If you prepare food in a central location—whether that is washing and packaging salad greens in a barn, baking cakes in a licensed kitchen, or bottling juices in a commercial kitchen—you’ll have equipment that is vital to your business. Commercial property protects your commercial location and equipment in the case of fire, natural disasters, theft, or vandalism.
- Commercial automobile: If you use a vehicle to drive your products and equipment to and from the market, it is a good idea to get commercial coverage for your vehicle so you are covered in the event of an accident while loading or unloading.
- Workers Compensation: If you have employees staffing your booth, workers’ compensation will cover them and your business in the event the employee gets injured or ill in the course of their work. Some states require you to have workers’ comp even if all your employees are family members. So, check your local labor laws.
- Cyber liability: If you also sell your products online or use a web-based payment processor to accept payments, cyber liability is a smart coverage to add. Cyber liability protects your business against claims and losses associated with data breaches, fraudulent payments, or other connected events that could impact your customers.
How Much Does Farmers Market Vendor Insurance Cost?
How much you spend on your farmers market vendor insurance depends entirely on how much and what type of coverage you purchase. A basic commercial general liability policy to satisfy the market organizers typically doesn’t break the bank. Small vendors can typically find policies for $25 to $50 per month. Larger or more complex food vendors may spend closer to $100 to $300 per month to meet all of their coverage needs.
For specialized coverages like commercial property, commercial automotive, and workers’ compensation, your premiums will vary widely based on your business size and the amount of equipment or number of workers you need to cover. Many carriers also consider your annual sales volume when pricing your monthly premiums. So, it is impossible to provide an accurate range of total costs here.
Your policy will be tailored to your business, so it’s best to get a customized quote from an insurance broker or commercial insurance carrier so you can budget accurately for your total insurance costs.
How to Save on Farmers Market Vendor Insurance
Farmers market vendor insurance tends to be affordable. But if you are looking for ways to reduce your costs, there are a few strategies you could employ:
- Work with a commercial kitchen or food incubator: Incubators and commercial kitchens typically have detailed application processes for food producers to work with and in their facilities. Considering this, many incubators have deals with insurance carriers that enable them to offer discounts on food liability and product liability insurance policies to member producers.
- Get food safety training: Many locations require food safety certifications or food handlers licenses. Even if your location does not require these, it is smart to get them. Proof of a food safety course could lower your insurance premiums, and it will almost definitely help you prevent many food-related accidents that could force a claim against your business.
- Take a fire safety course: If you use cooking equipment in your market stall, showing proof of a relevant fire safety training course could help reduce your insurance premiums. Market owners will want to see this certification, too. And it will help you manage preventable fires and mitigate your overall risk.
- Avoid accidents: Your insurance premiums can increase over time if your business has a lot of accidents and claims filed against it. So take care to avoid preventable accidents.
- Use a single carrier: If you plan to purchase multiple coverages—like general liability plus food liability and commercial auto, for example—try to purchase them all from a single carrier. Most carriers will offer some type of discount when you do.
- Pay premiums annually: If you can afford to do so, offer to pay your monthly premiums up front in a single annual payment. Many carriers offer a discount for annual payments.
FAQs
Farmers market insurance is a niche topic for small food producers and sellers. These are the most common questions I hear about farmers market vendor insurance:
Last Bite
Farmers market vendor insurance protects your small business in the case of a customer accident or injury. Most established farmers markets will require vendors to provide proof of insurance before renting booth space. Others will require vendors to sign a document stating that they understand the farmers market itself is not liable if your products cause illness or injury.
Whether or not it is required by your market, food vendor insurance protects you and your business. Any costs associated with paying your insurance premiums will be negligible compared to the cost of rebuilding your business from scratch.
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