Why insurance comes up
If a product you sell injures someone or damages property, you could face a claim. Marketplaces know this, so they have rules about insurance for sellers. Amazon has had a requirement for commercial liability insurance for sellers above a certain level of sales. The threshold and amount are set by Amazon and can change, so read the current policy in your account.
Types of cover you may hear about
- Product liability: covers claims that a product caused injury or damage.
- General liability: covers a wider range of business risks.
- Commercial property or inventory cover: covers stock that is lost or damaged.
- Cyber and business interruption cover: less common for small sellers but worth knowing about.
When to think about it
- When your sales approach the level where the marketplace asks for proof of insurance.
- When you sell products that carry more risk, such as those used on the body, in the home with electricity or by children.
- When you bring in a new product made by a supplier you cannot inspect easily.
- When you hold significant inventory in your own warehouse or with a third party.
What to check with an insurer
- Does the policy name the marketplace as an additional insured if required?
- What products and countries are covered?
- What are the limits, the excess and the exclusions?
- Does it cover products sold under your own brand and products you resell?
- What documents will the marketplace ask for, and how fast can the insurer provide them?
Insurance does not replace compliance
Insurance responds after something goes wrong. It does not replace testing, certification, accurate listings and sensible supplier checks. Insurers also look at whether you followed safety rules, so keep records of tests, certificates and supplier documents.
Keep records organised
- Policy documents and certificates.
- Product test reports and compliance certificates.
- Supplier agreements and quality reports.
- A log of customer complaints and how each was handled.
A practical checklist before you buy a policy
- Read the marketplace’s current insurance policy and note the threshold and required cover.
- List the countries and channels where you sell.
- List your product categories and any higher-risk items.
- Collect supplier details and test or certificate documents.
- Ask at least two licensed providers for quotes with the same cover details.
- Compare limits, excess, exclusions and claims process, not just price.
- Upload the certificate where the marketplace asks for it and diarise the renewal date.
Common mistakes
- Buying a policy that does not name the marketplace when it is required.
- Assuming a general business policy automatically covers product liability.
- Letting a policy lapse and discovering it only when the marketplace asks.
- Not telling the insurer about new product lines.
A short annual review of your cover with your broker or insurer keeps the policy in step with your catalogue.
How we can help
We include policy and document checks in our Account Audit and Account Health Monitoring services, so you know what the marketplace may ask for. We are not insurers or insurance advisers and cannot recommend a policy.
