FMC Explores Farmers Market Insurance Options
In March, the Farmers Market Coalition partnered with Campbell Risk Management to make an affordable liability insurance program available to farmers market vendors at a national level. The policy provides producers with group rates for $1 million in general and product liability per occurrence with a $2 million annual aggregate limit and a zero deductible, covering a producer’s participation in all markets. The policy is $350 for producers generating less than $100,000 annually from farmers market sales. (For more information about the program, please read the FAQ at the end of this post, or visit Campbell Risk Management’s web site)
State associations who are FMC members and interested in listing this CRM policy as a benefit of membership should contact Larry Spilker at 800-730-7475 ext 203, or firstname.lastname@example.org.
At the same time, we released two preliminary surveys, one on health insurance and one on liability insurance, with the goal of better understanding the insurance needs of the farmers market community so we may explore research and funding for more programs such as the one described above. The results thus far have been fascinating:
Liability Insurance (85 market manager respondents)
– 23% of farmers markets do not purchase general liability insurance.
– 33% of farmers markets who purchase insurance buy it directly from a private insurance company, 28% of farmers markets buy it from a farmers market association, and the remaining 17% buy it from their city, state department of agriculture, farm bureau, or other sponsor.
– Only 16% of these policies cover individual vendors at the market as well.
– 38% of market managers are ambivalent about or unsatisfied with their current liability insurance policy.
– 70% of market managers would be interested in an FMC-endorsed liability insurance offering.
– 39% of markets require that their vendors purchase product liability insurance, but 1/3 of these markets do not require proof of purchase.
– 53% of markets require that their vendors purchase general liability insurance, but a little less than 1/3 of these markets do not require proof of purchase.
Health Insurance (123 market manager respondents, 146 producer/vendor respondents)
– 20% of market managers and 19% of producers do not possess health insurance.
– 62% of producers with health insurance purchase it themselves, and the rest are evenly divided between receiving it through their other employer and receiving it through their spouse’s employer.
– 32% of market managers with health insurance purchase it themselves; 13% receive it through the markets. The rest are evenly divided between receiving it through their other employer and receiving it through their spouse’s employer.
– Producers ranked health savings accounts as their favorite type of health insurance (32% favor it), followed by PPOs (22%) and traditional indemnity plans (19%).
– Market managers preferred PPOs (34%), followed by health savings accounts (22%) and traditional indemnity plans (20%).
– Among both groups, HMOs and POS plans were the least popular.
– Among respondents in rural areas, inclusion of the majority of area physicians and hospitals was a key factor in plan selection.
– 92% of producers and 76% of market managers would be interested in a group health insurance plan.
With these results in hand, FMC is beginning to pursue avenues for increased attention to and development of improved health and liability insurance options for all who work or sell at American farmers markets. We would like to thank all of the survey respondents who helped set us on the right path.
Campbell Risk Management Insurance FAQ
What are the benefits of being a CRM partner in this program?
CRM will add your organization’s name to their website as a program partner, and will tailor the insurance application form so it acknowledges your helpful role and links to your organization’s membership application form.
What do I need to do to be an official CRM partner in this program?
- Contact Larry Spilker, Campbell Risk Management, email@example.com, 800-730-7475 ext. 203
- Provide a copy of your application form and/or a link to the place on your web site from which a form can be accessed, including the dues amount charged to farmer/vendor members
- Provide information about the program on your association’s website and a link to the Campbell Risk Management’s web page about this program
- Send an e-mail to your members about the program or include information about the program to your member newsletter
I’m a vendor. How do I apply to purchase this insurance policy?
How does a producer pay their premiums? Does my organization need to handle the applications?
Premiums are paid annually directly to Campbell Risk Management, which manages the applications and annual renewals, and processes all claims. Once coverage is extended, the premium is fully earned and non-refundable.
Does Campbell Risk Management offer a general liability policy for farmers markets?
Not at this time. Campbell Risk Management is working on a program for general liability for the actual markets and hopes to have a program in place for the 2011 season.
How many farmers markets can a producer add to the policy as an additional insured?
CRM has added an endorsement to the policy for blanket additional insured. There is no limit or cost for certificates. In the event of a product liability or general liability suit where both parties are named, the market is covered. In the event of a product liability or general liability suit where the market or any additional parties are named, all parties named in the suit are covered. This also allows the vendor to only need one certificate of insurance that specifies blanket additional insured.
What is the turnaround time from application to having a certificate and policy sent?
From the time an application is submitted, a vendor policy and certificate should be mailed to them within two weeks.
What kinds of products can be covered by this policy?
The products covered include anything seen in the normal scope of a farmers market, even items such as mushrooms, homemade cosmetics, home-processed poultry or other meats, eggs, dairy, and crafts. Provided that all applicable federal, state, and local permitting procedures are being followed, these are all considered within the normal scope of a farmers market and would be covered. Examples of items not covered would be alcohol and fireworks. On the application, producers will list all products intended for sale. If the products being offered are outside the scope of a farmers market, the producer will be contacted directly to discuss other coverage options. Liquor liability is NOT currently covered under this policy, although alcohol liability coverage may be available from Campbell Risk Management at a future date.
What if a market I want to sell in requires more than $1 million in coverage?
The program parameters are currently set up for $1 million per occurrence with a $2 million annual aggregate. For those needing higher coverage, an additional $1 million umbrella is available for $450 per year.
What if I generate in excess of $100,000 in annual sales at farmers markets?
The cost of the policy will increase at a rate of approximately $5 per additional $1000 of sales.
Is this program available in all states?
Thanks to the support of the Farmers Market Coalition, we have been successful in getting approved to offer this policy in every state (except Hawaii and Alaska, although we hope to be able to include them by 2011). The cost of the program is $350 per vendor in all states except for two, California $425, and Florida $250. In addition to the premiums stated there are a few states that charge an insurance premium tax that would be a small addition to the premiums stated above.
Will this program cover me for sales that I make from on my personal farm location?
This insurance program is location-specific to provide coverage for producer sales at farmers’ market locations where they sell their products. Sales made on the producer’s farm are not part of this policy coverage and should be picked up as part of their farm policy.
If a farmer already has a rider on their farm policy covering their sales at the market, why should they get this in addition to or instead of the rider on their farm insurance policy?
Many farmers are getting this policy and dropping the rider on their farm policy which provides coverage for off-the-farm sales at farmers markets. One reason for doing this is that a separate policy provides an extra layer of protection for a minimal $350 premium and protects the farmer’s whole farm insurance premium from any rate increases due to a claim made for product or general liability related to sales at farmers markets.