How Seller Insurance Secures Your Amazon Business ?
Running a business on Amazon comes with its own set of risks, which makes having Amazon seller insurance essential. This type of insurance is designed to shield your business from potential liabilities that can arise while selling on the platform.
Having the right policy in place ensures you’re covered against unexpected incidents that could financially impact your business.
In this post, we’ll walk you through what Amazon seller insurance covers and how it can help secure your business.
Keep reading to discover how to protect your business with Amazon seller insurance.
Why Amazon Seller Insurance Is Essential?
Aside from being a smart move, Amazon mandates insurance once a seller exceeds $10,000 in gross monthly sales.
This requirement falls under the Amazon Services Business Solutions Agreement, which outlines insurance obligations for sellers.
Amazon specifies that sellers must obtain commercial liability insurance within 30 days of surpassing $10,000 in monthly sales—and they can request proof of insurance at any time.
Beyond Amazon’s rules, insurance can protect you in cases such as:
- Customer claims of injury or damage caused by your product
- Property damage related to your product
- Allegations of copyright infringement or other legal claims
However, insurance doesn’t give you free rein to act recklessly. Just like any insurance claim, providers will investigate incidents and may deny coverage if you’re at fault.
That’s why it’s vital to consult a licensed professional to evaluate your insurance needs.
Types of Insurance for Amazon Sellers
While this isn’t legal or professional advice, here’s a brief rundown of the types of insurance commonly relevant to Amazon or eCommerce seller.
Every business has unique risks, but these are some common policies to consider:
Commercial Liability Insurance
Also called general or business liability insurance, this is the main policy Amazon requires once your monthly sales top $10,000. It typically covers customer claims involving injuries or damages caused by your products. However, it’s not the same as product liability insurance.
Product Liability Insurance
If you manufacture or private label your products, you could be liable if a product defect causes harm. This policy usually addresses issues related to product design or production.
3PL & Warehouse Insurance
If you operate a warehouse or work with third-party logistics providers, having this insurance can protect against risks associated with warehousing and order fulfillment.
Inventory Insurance
This policy covers losses or damages to your stored inventory—helpful in cases of theft, natural disasters, or accidents.
Workers’ Compensation Insurance
Even remote employees can file injury claims, like carpal tunnel syndrome. If you have staff handling admin or logistics, you may need this coverage.
Cyber Liability Insurance
With data breaches becoming more common, this insurance helps cover losses related to cyberattacks and compromised customer data.
Cargo Insurance
Also known as freight insurance, this type of policy protects your goods in transit from damage, loss, or theft.
Amazon’s Seller Insurance Policy Requirements
Once you exceed $10,000 in monthly sales, Amazon requires your commercial liability insurance to meet specific standards.
According to Amazon’s official policy, your insurance must:
- Be either commercial general, umbrella, or excess liability insurance that is occurrence-based
- Have a minimum limit of $1 million per occurrence and aggregate
- Cover liabilities tied to your business operations, including product-related injuries or damages
- Not have a deductible over $10,000, and the deductible must be listed on your Certificate of Insurance
- Cover all products listed in your Amazon store
- Include “Amazon.com Services LLC and its affiliates and assignees” as additional insured parties
- Match your legal entity name (or trade name for single-member LLCs) provided in your Amazon account
- Be issued by a provider with a global claims capability and a financial rating of S&P A- and/or AM Best A- (or local equivalent)
- Be fully completed and signed
- Provide Amazon with 30 days’ notice of cancellation, modification, or non-renewal
What is the Amazon Insurance Accelerator?
In classic Amazon fashion, the company has created its own solution—Amazon Insurance Accelerator.
Although Amazon doesn’t directly offer insurance, it connects sellers with vetted providers through this program. It’s safe to assume they earn a commission on referrals.
You can access an application for the Amazon Insurance Accelerator directly within Seller Central.
The Accelerator program is a curated list of insurance partners recommended by Amazon, but you’re not obligated to use them. You’re free to choose any insurer—as long as they meet Amazon’s policy requirements.
Choosing the Right Insurance Provider
There’s no one-size-fits-all answer when it comes to choosing an insurance company. It’s important to research and find a provider who understands your business.
One name that often comes up is Ashlin Hadden, a familiar face at Amazon seller events. You can visit her site at ecom.insure.
Other frequently recommended insurance providers include:
- Ashlin Hadden Insurance
- Next Insurance
- Insurance Canopy
- Well Insurance
What matters most is that the insurer knows the ins and outs of Amazon businesses and can tailor a policy to your needs.
Cost of Amazon Seller Insurance
Because every Amazon business is unique, most insurers will evaluate your operation before giving you a quote.
Ashlin Hadden Insurance offers clear, easy-to-understand pricing on her website. However, it’s best to complete a free application so you can get advice specific to your situation.
Final Thoughts: Why Amazon Seller Insurance Matters
In short, Amazon seller insurance isn’t just a good idea—it’s a requirement once you reach a certain level of sales. More importantly, it acts as a safety net for your business in case of unexpected events.
While I can’t offer professional advice myself, there’s a great Facebook group of Amazon sellers that can share experiences and recommend trusted insurance providers.
Thanks for taking the time to read—wishing you continued success with your Amazon journey!
