How Much Does Amazon Seller Insurance Cost? (2023 Rates)

Thang Truong
Thang Truong
Updated on:

Do you sell products on Amazon? Then you’re likely required to get Amazon seller insurance.

This article will reveal the cost of Amazon seller coverage and explain what you need to know to purchase the right Amazon seller insurance protection for you.

How much does Amazon seller insurance cost?

Based on a comprehensive review of insurers offering the coverage, including CoverWallet, NEXT Insurance, Thimble, The Hartford, and more, the average Amazon seller insurance cost is just over $40 per month or almost $500 per year for a $1 million general liability insurance policy.

Use that cost as a benchmark because costs can vary. They’re based on years of doing business as an Amazon seller, type of products sold, location, income, coverage limits and deductibles, additional coverages, how insurers calculate premium costs, and more. 

Contact several insurers offering Amazon seller coverage such as CoverWallet, Thimble, or the Hartford and get quotes from them. You can compare costs and coverages to get the best deal for your Amazon operation.

What factors impact Amazon seller insurance cost?

First of all, the Amazon sellers need to have general liability insurance coverage, which includes product liability protection. There are several factors affecting product liability and general liability insurance cost, which is the same as Amazon seller insurance cost. Below are a few important factors that you should be aware of:

Specific products that you sell on Amazon

Amazon seller insurance varies depending on the product liability insurance, whose costs vary depending on the risks associated with different types of products. Producing or selling things like fireworks or guns will have a significantly higher risk factor than clothes or bedding.

To determine product liability premium costs, insurance carriers consider your company’s risk of facing legal action over defective products, product recalls, design defects, misuse, and other product liability claims.

Size of the business

Larger businesses typically require more insurance protection, which costs more. The more products you sell, and the more customers you have, the more likely you’ll have claims. As a result, your Amazon seller insurance policy is more expensive. As your business grow, the premiums will be likely to increase.


Different insurance companies calculate Amazon seller insurance, a general liability insurance with product liability protection policy, premiums in different ways. And they may have different preferences (appetites) for covering certain types of businesses. This will impact the quotes insurers provide. It’s the reason you owe it to yourself, and your business, to get quotes from several insurance providers.

Claims history

This is a simple insurance concept most people understand. If you’ve made a lot of claims on your Amazon seller insurance,  it’s a sign to an insurer that you’re more likely to file more claims in the future. If you’ve filed claims in the past, you can expect to pay higher premiums. The lesson: Not all incidents are preventable, but it’s still important to operate your business in as careful a way as possible to avoid unnecessary claims that could increase your insurance costs.

Credit score

The credit score of the business owner who is the policyholder can also impact the cost of Amazon seller insurance. Credit scores are considered to be a measure of how reliable a policyholder will be in paying their insurance premiums in full and on time. They are also reflective of how responsible people are. If you have a low credit score, you will likely pay more for general liability insurance because you’re viewed as a bigger risk. The good news: A high credit score can save you money on coverage.

Location. Location. Location

Some cities and states are known for their high rates of lawsuits. If your business is located in one of them, you’ll pay more for your Amazon seller protection.

These aren’t all the factors that will influence your Amazon seller insurance premium, but they’re the ones that will have the biggest impact.

How to get cheap Amazon seller insurance?  

Here are some tips to help you find the coverage you need at a fair price:

Compare several quotes to find the best value.

Get quotes from a few companies so you can compare coverage and prices. Shopping around and comparing several quotes is the only way to find the best and the cheapest quote for your business. Working with a top broker like CoverWallet, Simply Business,, or is a good way to get and compare several quotes in one place conveniently. These brokers specialize in serving small businesses. Once you submit your quote request, they will be able to pull quotes from all of their partners for you to compare in one place.

Don’t stop shopping around.

Make sure you get new quotes before you renew your policy. Insurance companies change their quotes and rates very often. Your quotes will change in 12 months. So when it is time for renewal, make sure you shop around again to find the cheapest one for your business again.

Take advantage of discounts.

If they’re not offered to you when getting a quote, ask about them, whether you’re buying online or through an agent. Insurance companies always have the list of discounts, make sure you utilize any of them that is available to your business. Whenever possible, bundling several business insurance policies to get bundle discounts to save on premiums.

Taking these steps will help ensure you’re not paying too much for your general liability coverage.

What is Amazon seller insurance and what does it cover?

Amazon seller insurance, also referred to as Amazon commercial insurance or Amazon business insurance, is a group of different insurance coverages Amazon sellers purchase. 

Amazon requires sellers to have general liability and umbrella or excess liability insurance with at least $1 million per occurrence and $1 million aggregate coverage limits. 

General liability insurance protects you from claims arising from the following areas:

  • Product liability: Product liability included in a general liability insurance policy for Amazon seller is a unique feature. All Amazon sellers sell some physical products to the general public and their products could cause problems and their consumers can use the company. Product liability protects Amazon sellers against these claims.
  • Advertising injury
  • Third-party accidents
  • And more

Why do I need Amazon seller insurance?

Amazon requires sellers to get insurance because the online retailer doesn’t want to pay for lawsuits, settlements, and other issues related to the products sold on its platform through thousands and thousands of sellers it doesn’t fully control.

The Amazon requirement shouldn’t be the only reason you get coverage. You want to make sure that your business’s interests are protected, as well. Lawsuits against Amazon sellers happen all the time, and they can often be so costly that they could put a business without insurance out of operation. 

Product liability insurance for Amazon sellers covers the costs of customer lawsuits and settlements related to defective products sold by your business. If you resell products from manufacturers, you can’t control the quality of things not made by you. That fact alone makes Amazon product insurance coverage a must-have addition to your Amazon seller insurance policy.

Learn more at product liability insurance cost and the best product liability insurance companies

What are Amazon’s seller insurance requirements?

Amazon states in its guidelines that sellers must purchase insurance when they reach $10,000 in gross sales. That’s calculated by adding together all sales receipts before discounts, returns, and allowances. Amazon provides a short window for sellers to go without insurance when they’re new. Most sellers hit that $10,000 threshold relatively fast, especially if they sell costly goods.

Here are details about Amazon’s seller insurance requirements:

  • Once sellers hit the $10,000 sales level, they must secure an Amazon seller insurance policy with $1 million per occurrence and aggregate limits.
  • The insurance policy must take effect within 60 days of the seller achieving $10,000 in sales.
  • The coverage must be effective on a per-occurrence basis. 
  • The insurance policy’s deductible must not be greater than $10,000 and be disclosed on the certificate of insurance.
  • Sellers must get general and umbrella or excess liability coverage up to the $1 million limit requirement.
  • Sellers in the United States must get their insurance from carriers having at least an AM BEST A— OR S&P A— rating. This means the insurer is highly rated and can payout on claims.
  • Amazon, along with its affiliates and assignees, must be listed on the insurance policy as additional insureds, which means the policy covers them if something happens.
  • If a policy is not renewed, modified, or canceled, the seller must make certain that the insurer notifies Amazon 30 days before any of those things take effect. 
  • The policy must cover all the types of products carried by the seller. 

Amazon’s insurance requirements can seem complex. That’s why it’s essential to get coverage from insurance companies specializing in it. It will help you get the insurance you need to maintain your position as an Amazon seller while protecting your operation.

What is FBA insurance, and do I need it?

FBA stands for Fulfillment by Amazon. It’s a program that helps sellers deliver products more efficiently to customers by providing access to Amazon’s logistic network. Sellers that participate send their stock to Amazon’s warehouses and store it there, and Amazon handles receiving, stocking, packing, shipping, customer service, and returns. 

Amazon FBA insurance is tailored to the needs of sellers using FBA and certain other Amazon services. An insurer specializing in Amazon seller insurance can help you determine if you need this coverage and how much to get. This protection is relatively straightforward and should be easy to secure.

What is excess liability insurance, and do I need it?

Many Amazon sellers get this insurance, especially if they face the risk of costly lawsuits and settlements related to the products they sell. It’s a good idea to secure excess liability coverage if their products could cause severe physical harm or extreme property damage. Examples of these types of products include flammable things, chemicals, and nutritional supplements.

Excess liability coverage is a type of Amazon liability insurance added to general liability, professional liability, product liability, and other types of protection. Coverage kicks in when a lawsuit and settlement amount related to an incident caused by a product you sold on Amazon exceeds your general liability coverage limits. For example, a product you sell causes a devastating house fire, and the family members who live there suffer extreme smoke inhalation and burns. In the end, you’re held legally responsible. Your legal and settlement costs are two million dollars, but you only have a general liability coverage limit of one million dollars. Your excess liability coverage could help pay the difference.

Important point: Excess liability insurance can only act as backup for one policy, so multiple liability policies can’t use the same excess liability insurance as an added coverage option. In other words, you will need to add excess liability coverage for each liability policy you want to add excess coverage to. If you prefer to get a single insurance policy to act as backup for all of your liability policies, look into getting umbrella insurance. 

Your insurance agent or representative at your business insurer can advise you on the excess coverage that’s right for you.

What is commercial umbrella insurance?

Commercial umbrella coverage provides additional insurance protection to multiple Amazon seller liability insurance types. In simple terms, this insurance extends the coverage of all your liability policies when they exceed their limits up to the umbrella policy limit.

Learn more at the best commercial umbrella insurance companies

What does Amazon seller suspension insurance cover?

Amazon sanctions seller accounts for different infractions to ensure their customers stay happy and continue to purchase things on the Amazon platform. The most extreme sanction is suspending your seller account. Suspension happens when:

  • You sell any products on Amazon’s restricted products list, such as endangered animals, prescription products, and certain gambling devices. 
  • You break the terms in the user agreement.
  • Your Amazon store regularly gets terrible reviews and customer complaints.

It can take a long time — and a lot of paperwork — to restart a suspended account. It’s why it’s crucial to get Amazon suspension insurance. It pays for lost income and other costs resulting from a suspended Amazon account. There are three types of Amazon suspension insurance:

  • Loss of gross profit insurance covers lost profits because you can’t run your Amazon store due to a suspension.
  • Loss of gross revenue insurance pays the value of sales you lost because your account is suspended.
  • Increased cost of working insurance pays expenses needed to run your business that you agree to in order to reverse a suspended account. 

Amazon suspension insurance can help keep your business going until Amazon restores your authority to sell after a suspension. 

How can I purchase Amazon seller insurance?

Your amazon insurance can only come from carriers with solid industry ratings, such as CoverWallet, Thimble, NEXT, Prudential, TransAmerica, Progressive, and The Hartford. It helps ensure claims will get paid should something unfortunate happen to a customer or their property because of something sold through your Amazon store.

You owe it to yourself to get several quotes from different providers to ensure you get the right coverage for you at the best possible price. Here are our recommendations of the top Amazon seller insurance companies for your consideration.

If you sell more than one type of product on Amazon, you may have to get multiple Amazon seller insurance policies. Your insurance agent or expert at an insurance company can advise you if this is the case for you.

E-commerce business insurance

If you are running an e-commerce business, whether or not you are selling the products on Amazon, you’ll need business insurance coverage to protect your business and your personal financial well-being. Below are the common coverage e-commerce businesses would need:

  • General liability and product liability insurance coverage: These are the common coverage protecting your e-commerce operations from the most common lawsuits.
  • Cyber liability insurance: If you collect and store customers’ sensitive information such as personal details and credit card information, you will need cyber liability insurance.
  • Commercial auto insurance: If you drive a vehicle for your business purpose, you’ll need commercial auto insurance.
  • Commercial property insurance: If you rent a warehouse or an office to run your e-commerce business, you’ll need commercial property insurance. Your landlord will ask you for it before signing the lease.
  • Workers comp insurance: Lastly, if you hire full-time employees, you’ll need workers comp insurance. It is required in all states, except Texas. Even it is not required in Texas, this is one of the most important coverage to protect your employees, you should still have it.

Learn more about the business insurance coverage your e-commerce business would need and the best insurance companies for e-commerce businesses.

Thang Truong

Thang Truong covers small business insurance and small business success at BravoPolicy. He is a licensed P&C insurance agent. Previously, he held product leadership positions at, Capital One, NerdWallet, and Mulberry Technology. He holds a MBA degree from UC Berkeley - Haas School of Business.

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