Do auctioneers need special insurance to run sales?

Most professional auction companies carry several kinds of coverage. General liability insurance protects against injuries at previews and sales, a big concern when crowds gather at a farm, warehouse, or home. Coverage for consigned goods while they are in the auctioneer's care, sometimes called bailee coverage, protects sellers' property against theft, fire, or damage.

Depending on the business, auctioneers may also need commercial auto coverage, workers' compensation for employees, errors and omissions coverage, and bonds. Some states require auctioneers to be licensed and bonded, and requirements differ widely from state to state.

Check with your state's auctioneer licensing board, if your state has one, and work with a commercial insurance agent familiar with auction operations. Sellers can reasonably ask an auction company how their items are insured while in its possession, and whether that coverage protects them until the item is sold and paid for.