Public Liability Insurance and HMRC

More often than I would like to admit, I have a worrying conversation with potential exhibitors that goes a little bit like this:

Me: “To confirm your booking, please send over a copy of your public liability insurance.”
Exhibitor: “Oh, I don’t have insurance, this is only a hobby you see, to make a bit of extra money.”

But what is the problem? I hear you ask. Well, there are a number of issues in that one response that need addressing. More often than not, it is simply a misunderstanding of when you need insurance or when you need to be registered as self-employed. Hopefully this will make things crystal clear.

“I’m exhibiting at an event, do I need insurance?”
Simple answer: yes. Public Liability, or PLI, is a type of insurance that covers a business if a member of the public was to suffer a loss or injury due to your activities and went on to make a claim for compensation. The PLI would cover any compensation as well as any legal fees.

Simply put, if a customer were to trip over a box under your table and took legal action against you, your insurance would cover it. If you didn’t have insurance, you personally would have to foot the cost of compensation and legal fees.

“What other type of insurances are there?”
Far too many to list here! I’m no insurance expert, but if you feel there is a risk, get that risk covered and insured. Ideally, remove the risk all together by carrying out an in depth risk assessment.

The other main types of insurance are:
Employers Liability Insurance
If you have employees, you should have them insured. If an employee took legal action against you, you’ll be covered!

Professional Indemnity Insurance
This protects you against a whole host of things from any simple errors right through to if you break a rule in the Sale of Goods Act 1979! If you use an image without permission and legal action is taken out against you? Yup, this covers it! Accidently say something slanderous? You’re covered under this!

Product Liability Insurance
If you’re making or supplying a product and your product causes damage to someone or something, this is the cover you need! Making an earring and the earring makes someone’s ear fall off? This covers that!

“What about this self-employed tax stuff? This is only a hobby!”
HMRC says if you do any of the following you are likely to be trading and should be registered as self-employed:

  • sell goods you have bought for resale
  • make items yourself and sell them, intending to make a profit
  • provide a service and receive payment (whether in cash or in kind)

However, they go on to say you’re not a business if you:

  • sell occasional, unwanted personal items through internet auctions or classified advertisements
  • attend a car boot sale once a year to sell unwanted household items

I believe everyone who exhibits at my events should most certainly be registered as self-employed (at minimum) and carry public liability insurance (at minimum).

This article contains information on legal matters. I would suggest talking to a professional or a solicitor as I am by no means an expert.