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How to insure a market stall
Across Australia, in small towns and large cities, in suburban car parks and country fields, hundreds of festivals and markets provide communities with a place to buy and sell goods, often from first-time entrepreneurs – and a 2014 RIRDC report showed that 80 per cent of farmers' market stallholders make a profit.
What is market stall insurance?
Market stall insurance gives these stallholders the product liability insurance and public liability insurance that most market stall organisers need – as well as providing protection for market stallholders.
Lynette Rayner, editor and publisher of Australian Markets and Fairs magazine since 1993, says more than 20,000 people a year run market stalls, ranging from hobbyists who barely cover their costs, to professional traders who operate one or more market stalls at different markets every weekend. Then there are also the hopeful entrepreneurs and artisans testing the market for their new business – like Tina and Erik, who protect their new gluten-free vegan ice-cream business, Hunt and Gather Pops, with market stall insurance cover.
“Some iconic Australian brands, like Dinosaur Designs and Sass & Bide, started out at market stalls,” Lynette says.
“But whether you do it once or twice or all year round, you generally need to bring your Certificate of Currency to show the organiser you’re protected if someone is injured from the products you sell, whether they are electricals, cosmetics, foods – anything, really,” she says. She adds that ensuring stallholders have market stall insurance is usually a condition of the market organisers’ own insurance.
Generally, market stall insurance has two components – public liability insurance and product liability insurance.
Public liability insurance
This covers your liability for damage to property or injury to a third party that occurs in your designated market stall or exhibit area.
It can include accidental damage to property or to a person from the set-up of your stall – as Jessica discovered when a gust of wind blew the gazebo covering her clothing stall onto a nearby vehicle, causing more than $2000 worth of damage. Jessica was found to be liable for the damage because she had not secured the pegs of her gazebo correctly – fortunately, her insurance covered this.
Sometimes a market organiser will include public liability in the cost of the stall – but be careful to check what you are covered for if this is the case.
You should read the exclusions on your market stall insurance cover carefully. Usually, public liability insurance only covers claims directly related to your stall and will cover a period of time before and after the stall opening hours, to cover you for set-up and take-down times.
Typically, claims connected with amusement rides or animal stalls are excluded (separate cover must be arranged for these) and the cover will not typically be valid for use in a shopping centre lease or tenancy – you would need to arrange a Business Insurance policy or speak to a broker for this.
Product liability insurance
AAMI offers Market Stall and Trade Exhibitors Insurance for up to $20 million total cover for both public and products liability, with cover extending between three and 12 months.
What does it cover?
The products liability insurance component covers your legal costs to defend a claim and compensation costs to a customer, due to damage to property or injury to a third party as a result of the products that you sell at your market stall.
For example, it can cover a customer’s medical expenses, as Fiona discovered when she sold a chocolate cake that was marked as nut-free to a customer at her market stall. The customer had an allergic reaction to the cake, which was found to contain almond meal, even though Fiona had stated the cake was nut-free. Fiona was found to be negligent – but, fortunately, her customer’s medical expenses were covered under Fiona’s Market Stall Insurance Products Liability cover.
Exclusions to this cover include deliberately false statements or omissions by you, mistakes in advertised pricing, exports to North America, the cost of correcting work done by you, a breach of professional duty, business interruption or personal injury to employees.
AAMI offers Market Stall Insurance online, with instant Certificates of Currency and coverage across Australia.