What type of insurance coverage for an Amazon seller? | 2021
If you are engaged in e-commerce by selling online, you may realize that you face similar risks to other businesses. The company requires Amazon Marketplace participants to have a certain amount of business coverage up to $1,000 per time:
• Commercial General Liability Insurance
• Bodily Injury Insurance
• Personal injury insurance
• Ownership Insurance
Amazon sellers need to realize that this is a limited coverage that will not protect them if the losses warrant a larger claim. Like any business person, e-commerce participants need to assess their needs and obtain appropriate relevant insurance protection.
General liability insurance is basic coverage for the online seller – as in traditional retail outlets. It exists to protect your business from liability to:
In the event of a related lawsuit, this insurance can pay the amount you are ordered to pay and legal expenses.
Product liability coverage in general is linked to this policy. It protects the manufacturer or seller in respect of bodily injury or property damage to a third party that occurs due to a defective product.
However, there are cases where this type of coverage does not help. why? In the event the seller is not appropriately rated and makes a claim, he may get a “No” from the insurance company.
Take the case of Mary – an Amazon seller who successfully sold skincare products to an online marketplace.
All was well, commercially speaking, for Mary until the fateful day when a consumer sued her for severe skin irritation thanks to the creams Mary had sent her. When Marie filed a claim, she was in shock: The insurance company refused coverage because their policy had been misclassified as an online retailer. As someone who put her company labels on her creams, she should have been labeled a “manufacturer”!
Too bad her agent didn’t catch the bug! The financial consequences had a far-reaching effect, eventually forcing her to file for bankruptcy.
While this illustrates the urgent need to research policy issues, there are other forms of coverage that an Amazon seller needs to be very familiar with.
Other Amazon Seller Policies
One of the biggest concerns any Amazon seller has is the possibility of being suspended from the Amazon seller network. If this occurs, the loss of income can be significant. Amazon Suspension Insurance is the industry’s #1 recommended coverage across the board.
Other insurance policies to consider are:
• Automotive business
• labor camp
• Umbrella / Surplus
• Electronic Responsibility
• marine oceans
Of course, nothing takes the place of speaking to an insurance professional who will direct you to an insurance program tailored to you.