Public liability insurance for market traders

Putting the question into context

The policy needs to match the work as it is really done. A tidy trade name on its own does not tell an insurer enough.

Cover applies within the stated dates, activities, limits and conditions. That sounds plain, but it is where many misunderstandings begin.

A sensible description of the risk should take account of: a customer trips against the stall; a gazebo moves in wind; and a product causes injury after sale. The examples are there to test the description of the business. The policy wording still decides how a claim is handled.

Have the following details beside you: products and country of origin; cooking, heat, blades or demonstrations; and indoor, outdoor and frequency of trading. If one point is uncertain, ask how the question should be answered and keep the reply.

Do not file the documents unread. The business description, limits, excesses and endorsements deserve a first-day check. Make the enquiry before accepting the policy rather than after an incident.

Where the exposure comes from

These are the less obvious ways trouble can start:

• A customer trips against the stall
• A gazebo moves in wind
• A product causes injury after sale

If one of these examples is a regular part of your work, make sure it has not been lost in a broad trade description.

Suppose the issue was “a customer trips against the stall”. A provider would need more than the trade name. It may need to know the job, the property involved, the precautions required and when the problem first became apparent.

Now compare that with “a gazebo moves in wind”. It may involve a different cause and a different part of the wording. Similar-looking claims do not always follow the same route.

An insurer may still reach a different view after investigating a real incident. At the buying stage, accuracy is the part within your control.

Useful records for the quotation

Recent invoices and contracts should help you establish:

• Products and country of origin
• Cooking, heat, blades or demonstrations
• Indoor, outdoor and frequency of trading

A trade name rarely tells the whole story. “products and country of origin”, “cooking, heat, blades or demonstrations” and “indoor, outdoor and frequency of trading” give the provider a clearer account of the tasks, people and places involved in the work.

A customer may later read only the certificate. You should still keep the fuller schedule and endorsements for your own records.

Two reminders from this page are “public and products liability should both be checked” and “secure the pitch for weather”; keep them beside the documents when you check the quotation. If the policy takes a different approach to “products and country of origin”, ask about it before the cover is needed and retain any written reply.

Save the answers you submit. Check the insured name, business description and dates when the policy documents arrive.

Do not skip the endorsements

• Public and products liability should both be checked
• Secure the pitch for weather
• Keep supplier and batch records

If a clause is unclear, ask for an explanation before the cover is needed. Keep that explanation with the policy.

Before you submit the quote

Read a recent contract and compare its insurance clause with the limit and business description you plan to buy.

A short written record can save a long disagreement about what was said when the cover was arranged.

Do not discard the earlier policy when a new one begins. A claim can arrive well after the work was completed, so the documents in force at the time may still be needed.

Do not let the following point get buried: keep supplier and batch records; check how this affects the jobs you accept and ask for clarification if the policy takes a different approach.