Selling on Amazon can be very good for your business, but do not forget to always be insured to avoid losses or legal inconveniences. Commercial Liability Insurance is now mandatory by Amazon and will help you be calmer in the face of any complaint or inconvenience from your buyers, remember that anything can happen and it is better to be cautious when selling online
What is Amazon commercial liability insurance?
Help protect you and your customers in the event that one of the products you sell is defective and causes physical or property damage. It will help you defend yourself in scenarios where one of your products causes property damage, injuries, allergic reactions, and will help you cover legal fees and medical expenses.
Let’s say you sell hairdryers and a malfunction causes a fire, commercial liability insurance will help cover all medical expenses and protect you from having to pay all of the reimbursement yourself.
Which sellers require commercial liability insurance?
All sellers who list products on amazon.com within 30 days of selling $10,000 in any month. Sellers on Amazon have been required for years to have liability insurance. Amazon is just now forcing you to prove it.
This requirement is mentioned in the Amazon Services Business Solutions Agreement
What are the requirements for Amazon commercial Liability insurance?
Here are all the criteria your insurance must meet:
- The insurance policy must have limits that are at least $1 million per occurrence and in aggregate
- The policy type must be commercial, general, umbrella or excess liability and written on an occurrence basis.
- Amazon also accepts policies written on a claims made basis for certain product categories. If you can’t get an occurrence based policy
- The policy must name “Amazon.com Services LLC and its affiliates and assignee” with address “P.O. Box 81226, Seattle, WA 98108-1226.” as an additional insured.
- The policy must cover all sales from products you’ve listed in the amazon.com store.
Your insured name on the policy must match the legal business name you have provided Amazon in Seller Central. You can find your legal business name here
How can I obtain insurance?
You can choose as long as the provider meets Amazon’s criteria and your expectations. Amazon has an Insurance Accelerator Program, this program provides companies that meet Amazon policy requirements and offer competitive policies and coverage.
What is the process of uploading proof of insurance?
Once you’ve obtained liability insurance, ask your provider to issue a Certificate of Insurance that fulfills Amazon’s Insurance requirements Then, upload your Certificate of Insurance for verification here.
When submitting proof of insurance, make sure you enter exact accurate information. And be sure to upload your one-page certificate of insurance or CLI and not any other document. All information needs to match your CLI!
How are claims resolved after Amazon receives them?
Amazon resolves all buyer claims related to defective items (Item Fails to Meet Buyer Expectation) under the A to Z claims process. Amazon first evaluate the claim which can be reviewed by a professional, once confirmed, Amazon will work with the customer directly to resolve the case
- For customer claims of $1000 or less, Amazon will resolve the claim through a concession to the customer and will not request reimbursement from you or your insurer if you provide proof of insurance.
- For customer claims above $1000, you or your insurer must handle the claim directly with the customer.
How to prevent A to Z Claims
Here are some tips on how to prevent these claims
- Please verify that all images and descriptions match the product features and expectations, everything must be precise.
- Include valid tracking for all deliveries.
- Confirm shipments prior to the expected ship date.
- Make sure the delivery is completed before the estimated delivery date
- Quickly cancel any out of stock order
- Reply to buyers within 48 hours
- Reimburse buyers proactively
- Communicate clear instructions to the buyer on the return process.
Have more questions about Seller Central and how to get started? We would love to give you a hand. Let’s talk!
Keep up with the latest Amazon and Walmart news updates and subscribe to our BellaVix newsletter 👇👇👇