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Do Amazon sellers have to carry liability insurance?

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Do Amazon sellers have to carry liability insurance?

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If you are a new Amazon seller, you may not know whether you should obtain liability insurance coverage. Ultimately, Amazon sellers should carry liability insurance to help their businesses avoid costly accidents. Without the right coverage, you could have to pay a significant amount of money to cover a claim. Fortunately, sellers can choose from many liability insurance options. Often, Amazon requires that certain sellers obtain liability insurance to cover potential damages. Please continue to follow along to learn about the different types of liability insurance coverage available to Amazon businesses. With years of experience, our proficient Amazon Seller Advice and Guidance experts can help you take the necessary steps to help you grow and maintain your Amazon business. 

What is product liability insurance?

Product liability insurance is a type of coverage that covers any potential damages caused by a defective product from your Amazon business. Sometimes, unsafe products are sold to consumers which can cause serious injuries and accidents. If a defective product is sold to a consumer it is imperative to have liability insurance to protect yourself from having to pay any out-of-pocket expenses. Regardless of whether you are selling your products or you are a reseller, this type of insurance coverage can protect you from liability. Amazon is not liable or responsible if a defective product causes harm to a consumer. Rather, you, the Amazon seller are considered to be fully responsible. To protect your business’ assets, it is important to obtain general liability and product liability insurance coverage. Being insured is a requirement for a reason.

What type of insurance does Amazon require sellers to obtain?

Ultimately, Amazon requires sellers that have sales of over $10,000 a month to carry insurance that covers at least $1,000,000. Amazon sellers can obtain Commercial General Liability (CGL), Umbrella, or Excess liability insurance. Oftentimes, sellers confuse umbrella and excess liability coverage. Umbrella liability is coverage that offers higher liability limits when an underlying policy might not. Excess liability offers coverage for losses above the limits of a primary policy. Ultimately, as a seller, you can satisfy Amazon’s liability insurance requirements by using a combination of coverages. Regardless of your business size, it is critical to be insured. Unfortunately, things can go wrong in the blink of an eye and could wind up costing you a substantial amount of money. To protect yourself from liability, you should consider obtaining liability insurance coverage.

For more information on how obtaining liability insurance coverage for your Amazon business can protect you from costly accidents, please don’t hesitate to reach out to one of our knowledgeable team members. We are committed to helping our clients maintain their Amazon business. Contact us today!



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