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Vape sector insurance – is it heading for market failure?

Dec 7, 2023

We have been placing the insurance needs of the UK vaping sector for many years now. Indeed, given the issues vape businesses face getting cover, it’s an area we have written multiple blogs about since 2018.

It is well known that meeting the needs of the sector has become increasingly difficult with insurers reluctant and usually refusing to consider product liability due to worries around long term health issues. Add to that, in the early days of the sector, there were issues around batteries overheating and high profile “explosions “of units.

The market has evolved over the years. We are out the other side of vape businesses being hidden within portfolio transfers. We are also beyond some rather ingenious ways to present a vape business as something else – a tobacconist or an electrical goods business are just two common examples.

But now we have a more immediate and pressing problem.

We are now seeing capacity providers withdrawing from the market because of the reputational issues that mar the sector – specifically the number of young people who vape. One major capacity provider has said they will not continue.

It’s a perfect storm. The small number of carriers is getting smaller. At Anthony Jones we are worried about market failure. Is it just us? Are there capacity providers out there that we are unaware of. Anyone want to step forward?

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