Every farmers market has a unique set of goods for sale and even a unique location to conduct business. Because each farmers market may be drastically different from the next, it is important to carefully examine the specific risks of your business and obtain extensive coverage to ensure you do not miss any gaps.

What insurance coverage do I need for my farmers market business?

While there are many types of coverage for companies to consider, these insurance policies are particularly important for farmers markets:

General Liability Insurance

General liability insurance financially protects your business if you unintentionally cause bodily injury, property damage, personal injury, or advertising injury to a third party. Because your farmers market is open to the public, general liability insurance can protect your business if a third party is injured on your business premises. It is important to note that if your farmers market is held in the parking lot of an established business, you must still obtain your own general liability policy even if the established business has one in place. 

General liability insurance also covers third-party bodily injury or property damage resulting from product liability. This is a vital component of general liability insurance because you could be held liable if a customer is injured or becomes ill from produce purchased at your farmers market. 

In addition to these types of risks, general liability insurance can protect your business from lawsuits based on non-physical personal injuries. For instance, if you are accused of copyright infringement in advertising, slander, or libel, general liability insurance provides financial protection against these claims.

Examples:

• Bodily injury: While browsing your farmers market, a customer trips over uneven pavement and twists her ankle. Your general liability insurance will cover the medical costs of this bodily injury and any legal fees if the customer decides to sue your business.
• Product liability: A number of your customers suffer from food poisoning after purchasing and consuming vegetables from your farmers market. If these customers sue your business, your general liability insurance would cover legal fees and settlements. 
• Personal and advertising injury: Your new advertisements use designs that look very similar to a professional illustrator’s work. The illustrator sues your business for copyright infringement. Your insurer will cover the lawsuit and any resulting settlement. 

Commercial Property Insurance

If you own or lease the commercial space where your farmers market conducts business, it would be wise to consider commercial property insurance. Commercial property insurance protects the value of your business’s property, providing funds for repairs, replacement, or rebuilding if property is damaged or destroyed by a covered peril. 

Examples of covered property include the buildings belonging to or leased by your company, as well as the contents of the building, including furniture, equipment, and tools. For instance, if there are refrigerators or grills in your farmers market, your insurer can cover damages if this equipment causes a fire. Fire is a commonly covered peril alongside theft, vandalism, windstorm, and water damage.

Example:

• A fire breaks out in a stall at your farmers market. The fire quickly spreads to the surrounding stalls and even significantly damages the building itself. Your commercial property insurance would pay to replace your damaged equipment and repair the damage to the building. 

Inland Marine Insurance

Inland marine insurance covers products, equipment, and other forms of business property that are not tied to a fixed location and are not covered by commercial property insurance. This is especially important for farmers markets who conduct their business seasonally or only on certain days and must regularly transport valuable equipment from place to place. 

Inland marine coverage is usually added as an endorsement to your standard commercial property insurance policy, but there are exceptions. For instance, if your farmers market does not have a permanent location, inland marine insurance may be a better choice to cover your business property instead of a standard commercial property policy since your business property is constantly traveling with you. 

Example: 

• You are en route to a new seasonal location for your farmers market when your vehicle is involved in an auto collision. The crash damages your expensive refrigeration equipment. Your inland marine insurance policy will reimburse you for the loss.

Workers’ Compensation Insurance

Workers’ compensation insurance covers employees’ medical expenses and lost income if they suffer an injury or illness because of their work. In the event of a work-related death, workers’ compensation insurance can provide benefits for the employee’s surviving dependents. 

Your employees must often engage in physically strenuous work during the setup and tear-down process of your farmers market. Even the act of transporting heavy produce to your stalls puts your employees at risk for injury, so this coverage is vital to obtain. In almost every state, workers’ compensation insurance is required for employers, and there may be serious fines and penalties for companies that do not secure adequate coverage.

Example:

• One of your employees cuts open his hand while he is putting together a new wooden stall for your farmers market. Your workers’ compensation policy would pay for his medical bills and a portion of his lost income if he is unable to work during recovery.  

Commercial Crime Insurance

Commercial crime insurance is an important policy for farmers markets because it provides financial protection from losses stemming from criminal acts. With so many customers exploring your farmers market, there may be a shortage of staff to monitor activities. This makes your business particularly vulnerable to criminal activity.

Commercial crime insurance covers losses due to forgery, robbery, burglary, theft, and employee dishonesty. There is particular risk for employee theft, as employees handle cash transactions and may be unsupervised.

Example:

• When your staff members are distracted, a customer takes petty cash from one of the booths in your farmers market. Your commercial crime insurance would cover this financial loss.

Additional Coverages

• Liquor liability insurance is important if your farmers market serves any alcohol on the premises. If a customer drinks too much and causes bodily injury or property damage to another third party, you could be held liable.
• Commercial auto insurance covers auto accidents caused while driving company-owned or leased vehicles, but hired and non-owned auto insurance is important to consider if you and the employees of your farmers market often rent or use personal vehicles for business purposes. This coverage provides financial protection for third-party bodily injury and property damage, as well as any legal costs associated with the accident. 
• Equipment breakdown insurance covers the repair or replacement of malfunctioned or damaged equipment, while spoilage insurance can reimburse your business in the event of lost perishable goods due to power outages or equipment failures. Both coverages are important considerations for farmers markets.

Pricing and Quotes

Pricing for business insurance will vary based on the type of insurance coverage and the risk profile of your business. Insurers consider factors such as:

• Business size
• Industry
• Location
• Number of employees
• Claims history

Businesses with higher risks will have higher premiums than those deemed lower risk. For example, a farmers market with a history of frequent claims will face higher premiums. Premiums also rise as you increase the limits of insurance. Different insurance companies have different models for rating risks, so it is worth comparing pricing across different insurers.

In order to get an accurate estimate on pricing, it’s best to get a quote from a reputable insurance company. Below we’ve highlighted a few of our trusted partners who offer coverage for farmers market businesses:

Provider	General Liability	Professional Liability	Business Owner's Policy
Embroker	??	??	??
CoverageSmith	??	??	??
CoverWallet	??	??	??
Hiscox	??	??	??
Thimble	??	??	??

Final Word

It is essential to take your time when considering your various risk exposures to ensure there are no gaps in your coverage. The large range of goods sold and potential business locations means each farmers market may need different coverage than a neighboring business. It is important to carefully select adequate coverage in order to keep your business protected in the face of an unexpected disaster or accident.