Imagine this, you spend your spare time organising an event which is very important to you – whether it be to raise money for a local charity, help raise awareness regarding a specific issue or even to just do something nice for the local community. You spend time and money putting on your event and it all goes off without a hitch, except for the minor issue that one of your food stalls at the event did not cook one of their meals properly and as a result, the person who ate that meal suffered from food poisoning.
Next news, a solicitor’s letter drops on your doorstep informing you of the incident and notifying you that as you was the event organiser, you are a potential named defendant in this claim until such a time that it can be proved otherwise. You seek out the relevant person(s) who were responsible for the stall to investigate further, only to find out that they did not take out any form of event public liability insurance to protect should this kind of incident occur. You advise the solicitors of this, only to be told that as you were the event organiser and did not carry out the relevant checks to ensure all stall holders held public liability insurance before being allowed to attend your event, that the claim was then to be directed towards yourselves.
Your policy may contain a clause that makes it a condition of insurance that any independent stall holder, exhibitor, contractor or supplier whom you engage at or for the event, or otherwise permit or allow to stand exhibit or supply services to the event, must be required to hold third party liability insurance in their own right for the duration of the event, and evidence of the relevant policy, including the name of the insurer, the policy number and Limit of Indemnity must be recorded by You prior to their participation at the event.
If you fail to comply with this condition your insurers may refuse liability due to a breach in contract in relation to the endorsements of your policy not being complied with. An example of this kind of endorsement can be seen below:
Endorsement 1 – Bona Fide Sub-Contractors Clause : It is warranted by the Insured that all sub-contractors that they engage, maintain employers’ liability and public liability policies that provide:-Employers’ liability coverage with a limit of indemnity of not less than GBP10,000,000 for any one occurrence; Public liability coverage with an indemnity limit of not less than the limits provided by this policy; An indemnity to the Insured as principal.
It is further warranted by the Insured that they do not assume by agreement any liability or potential liability that would not have attached to them in the absence of such agreement, including but not limited to, the assumption of any liability or potential liability on behalf of any bona fide sub-contractor, or the waiver of any rights of recourse against any bona fide sub-contractor.
All of that hard work and effort spoilt by the small error of not carrying out the relevant checks to ensure that all stall holders/outside contractors carried their own event insurance before being allowed to attend your event.
It is vital that these checks are carried out to avoid any compromise in your cover.