hi Fiona b,
I'm in the Irish Republic so I'd imagine that the same regulations apply throughout the EU.
I will be joining some markets for the first time this summer. One of the first questions they asked when I sent in my application was if I had indemnity insurance. Basically, I won't be allowed in without it.
I don't think it's a legal requirement but most markets here insist on it, so that they themselves are covered in the event of your product having an adverse affect on a customer.
A number of shops stock my soaps and they never asked for it.
sorry I can't be any more help.