All the information you want regarding Amazon’s insurance requirements
Whether you’re a novice third-party seller on Amazon or a seasoned pro with years of experience, it’s critical to safeguard yourself with Amazon sellers insurance and understand when it’s necessary. You could be requested to provide a amazon certificate of insurance since Amazon mandates that some sellers maintain active coverage. Everything you need to know about Amazon insurance regulations will be covered in this post.
Is insurance required to sell on Amazon?
Amazon mandates business insurance for sellers who have Pro Merchant accounts and gross monthly sales of $10,000 or more for three consecutive months. Why does Amazon demand this insurance coverage? If you sell anything on their platform that results in an accident or property damage, they want to reduce their exposure to responsibility. Even though you are not obliged to have insurance, you might still want to get it so that you are covered in the event that someone makes a claim that they were injured or that your product caused damage.
Required insurance for Amazon sellers
What you need to know about buying an insurance plan that satisfies the Pro Merchants’ Amazon seller insurance criteria is provided below.
You’ll require liability insurance.
In order to comply with Amazon’s seller insurance requirements for Pro Merchants, you must have $1 million in liability coverage, per event and overall. Your insurance (or policies) must offer protection against:
- Liability for products
- Products and finished operations
- Bodily harm
- Personal harm
- Generalized property damage
Why is insurance necessary for Amazon sellers?
Amazon does not want to be held accountable for defective goods or lawsuits brought by irate consumers. Because of this, they mandate insurance for merchants who have Pro Merchant accounts and gross sales of at least $10,000. But bear in mind that getting insurance is a smart idea even if you’re not needed to have it in order to sell on Amazon. If anything goes wrong, insurance can assist safeguard your cash.
Consider a scenario in which a customer purchases the face serum you provide and experiences a severe allergic response that sends them to the hospital and leaves them with a mountain of medical debt.
Or the remote-control car you loan someone blows up in their living room, burning the carpet and sofa, which now require replacement. If you have insurance and clients sue you for reimbursement of their medical expenses or replacement of their damaged property, the insurance provider will contribute to the cost of your legal defence as well as any settlements that are reached. Or, your insurance might contribute to a solution before you even file a lawsuit.