Starting September 1, 2021, Amazon began requiring sellers on its US platform with over $10,000 in monthly sales to purchase business insurance for Amazon sellers within 30 days, with Amazon listed as an additional insured party. As of 2024, this regulation will expand to Amazon’s European markets and Canada, affecting even more sellers.

This insurance, known as Amazon seller business insurance, is a form of commercial liability insurance that protects sellers from claims related to property damage, bodily injury, and other liabilities caused by their products. The main reason for this requirement is to shield both Amazon and sellers from legal risks arising from potential issues with the products sold on the platform. It ensures that sellers have coverage in case of lawsuits or damages linked to their sales activities.

The cost of Amazon seller liability insurance depends on several factors, such as the types of products being sold and the seller's revenue. Typically, premiums range from $500 to $1,000 per year, but sellers can consult insurance providers or Amazon's Insurance Accelerator for tailored quotes.

Failure to meet these Amazon seller insurance requirements could lead to serious consequences, such as Amazon restricting the sale of certain products or even suspending a seller's account. Many sellers are concerned that this additional expense increases their operating costs, but compliance is crucial to avoid disruptions in business.

Fortunately, Amazon offers a solution through its Insurance Accelerator program, where sellers can purchase comprehensive Amazon seller business insurance that covers all their sales across Amazon’s global sites. This policy will be available starting June 15, 2024, based on truthful declarations of sales and products. Sellers must prioritize securing this insurance to avoid penalties and keep their accounts in good standing.

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