Seller Liability Insurance
hello,
I heard that once you have 10k of sales in a month or more that Amazon will require you to have general liability insurance. I will have more than 10k this month so want to get ahead of it. First, do I need to have an LLC in order to get Liability Insurance? Second, can someone explain the benefit of doing an LLC?
Seller Liability Insurance
hello,
I heard that once you have 10k of sales in a month or more that Amazon will require you to have general liability insurance. I will have more than 10k this month so want to get ahead of it. First, do I need to have an LLC in order to get Liability Insurance? Second, can someone explain the benefit of doing an LLC?
2 replies
Seller_kIukTwdhvntAp
"Second, can someone explain the benefit of doing an LLC?"
Talk to an attorney or an accountant. You are asking bar tenders to perform brain surgery.
" do I need to have an LLC in order to get Liability Insurance? "
Yes, no, maybe.
It will probably depend on the underwriting insurance company but you will need to ask the company.
Take care of the LLC question first and remember, once you are required to have it that never goes away.
I hit the magic $10,000 about three months total in the past 14+ years (during COVID because Amazon was a mess and I sell non-essentials that people wanted.)
I've been paying $1,000/year +/- for the past 4 years with sales no where near $10,000 most months!
Steve_Amazon
Hi @Seller_KpXCpMWug8F3h,
Steve from Amazon here, thank you for reaching out. Under section 9 of the Amazon Services Business Solutions Agreement, you must obtain and maintain commercial liability insurance within 30 days after exceeding USD 10,000 in gross proceeds in sales in one month on Amazon.com, or if otherwise requested by us.
You may purchase either commercial general, excess, or umbrella liability insurance. When you decide on an insurance provider, your policy should cover all products you list for sale in the Amazon.com store.
We have worked with an insurance broker to create Amazon Insurance Accelerator, a network of insurance providers who will evaluate and, if appropriate, offer liability insurance at competitive rates to qualifying sellers. You can learn more about Amazon Insurance Accelerator and contact the providers here.
If you do not wish to use the Amazon Insurance Accelerator, you can choose any insurance provider that meets our requirements below.
- The insurance policy type can be either commercial general, umbrella, or excess liability and be occurrence based, except for certain product categories that are outlined in the Frequently asked questions;
- The policy limit must be at least USD 1 million per occurrence and in aggregate, and cover liabilities caused by or occurring in conjunction with your business operations, including products, products/completed operations and bodily injury;
- The deductible for any policy(ies) must not be greater than $10,000. Any deductible amount must be listed on your Certificate of Insurance;
- The policy must cover all sales from products you have listed on the Amazon.com store;
- The policy must name "Amazon.com Services LLC and its affiliates and assignees" as additional insureds;
- Except for single-member LLCs, your insured name must match the “legal entity” name you provided to Amazon in your Account Info. For single member LLCs, where your legal entity name is different than the name you publicly use to identify your business (“trade name,” “doing business as,” or “DBA”), it is also acceptable for your insured name to match your trade name;
- Your insurance provider must have global claim handling capability and a financial rating of S&P A- and/or AM Best A- or better (if S&P or AM best is not valid or used in the country where you are required to obtain insurance, a local equivalent is allowed);
- The policy must be completed in its entirety and signed; and
- Your insurance provider must give Amazon at least 30 days’ notice of cancellation, modification, or nonrenewal.
Please let me know if you have any questions.
Thanks,
Steve
