Flea market vendors often question whether or not they need to obtain small business liability insurance. Depending on the type of booth a vendor runs and the products he or she sells, as well as on the assets the business owns, operating without liability insurance can be risky. Sole proprietors are especially vulnerable because their personal assets, including a home and car, can be taken in a business-related lawsuit.
Several types of business insurance are available for flea market vendors, beginning with general liability insurance. According to the U.S. Small Business Administration (USSBA), a general liability policy will protect against claims of negligence. All policies differ, but typically a general liability policy will cover negligence resulting in bodily injury, medical expenses, property damage, lawsuit expenses and court costs. Some policies may also cover product liability issues.
If your general liability policy doesn’t cover product liability claims, you may want to consider product liability insurance as well. The USSBA recommends getting product liability insurance if your business is involved in manufacturing, distributing, wholesaling or retailing products. Any product or service your business handles or produces poses a risk for personal injury or property damage. Businesses can also be held liable for warranties, instructions, defects and negligence.
Event liability insurance is another option
Short-term liability coverage, also known as event liability insurance, may be an option for vendors as well. It provides general liability for specific events, and is designed to protect vendors against lawsuits from third parties for bodily injury or property damage. A vendor, also known as an exhibitor or concessionaire, is defined as a person or firm that operates a business within the premises belonging to another under a concession, usually as the seller of certain goods or services during a short duration event, such as a fair or flea market.
Many insurance agencies offer short-term coverage for flea market vendors who operate pushcarts, kiosks, temporary booths and tables. Event coverage can be available for single events or on an annual basis, and can include:
- General Liability (Bodily Injury/Property Damage)
- Care, Custody or Control Liability (Third Party Property Damage)
- Collapse of Temporary Structure Liability
- Contractual Liability
- Damage to Premises (Fire Legal Liability)
- Hired and Non-Owned Auto Liability
- Liquor Liability (For the sale of alcohol)
- Medical Payments
If you are considering obtaining liability insurance, here are a few steps you can take:
1. Assess your business activities and the associated risks. For example, are you selling food or potentially explosive devices? If so, your risk could be higher.
2. Decide which types of insurance meet your company’s needs and the amount of coverage required for each policy.
3. Select a reputable commercial insurance broker to help you find the right insurance company that provides specialized policies that might be bundled together at reduced rates. An insurance bundle is a business owner’s policy (BOP).
4. Research the insurance company that your broker recommends to determine if the company’s rates are competitive and if its policies meet your company’s needs. Check their rating with the Better Business Bureau.
Flea market vendors, like any small business operator, may be liable for property damage and bodily injury under certain circumstances. With the wide range of insurance products available, and the variance in price points, it makes sense to consult a commercial insurance broker to help you assess your risk and select the right insurance coverage to protect you, your business and your customers.