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Ecommerce businesses and online retailers are exposed to various liabilities from defective products to allegations against your business. Ecommerce insurance can protect your business against lawsuits, accidents, and financial losses. We’ve evaluated the best e-commerce insurance providers based on coverage, financial stability, customer satisfaction, and overall quality.
Next Insurance leverages AI technology to streamline the process to purchase insurance, track claims, and manage policies at no additional cost.
Coverwallet began its journey in New York City in 2015 operating under the Aon Insurance banner. At Coverwallet, you can access everything you need to keep your company well-protected at an unbeatable price.
Simply Business provides insurance policies for a range of professions and small businesses.
With a 100-year history of insuring businesses, Hiscox is well-known across America and globally. With more than 500,000 small business customers, Hiscox is fully aware and trained in the unique risks a business can face.
Thimble provides business insurance that can be tailored to your business by the year, month, day, or even the job. At Thimble, the process to getting the right business insurance is simple, scalable, and flexible.
Spott will ensure that your policy coverage is tailored to your business while complying with Amazon’s Terms and Conditions. They also track changes to Amazon’s Terms and Conditions to identify potential issues with listings before a suspension.
While e-commerce stores do not have the same risks as a traditional brick-and-mortar business, there are multiple risks to consider while operating an online business. For example, hackers could steal customer data, defective products could cause injury, and deliveries could get lost in transit.
Ecommerce insurance can provide coverage for financial losses that emerge due to legal action, property damage, and reputational harm.
Businesses selling online through a website or via a platform like Amazon should consider e-commerce insurance. In some cases, third-party platforms require proof of insurance before you can start selling your products.
Service-based businesses such as tutoring, copywriting, transcription, and website design could also benefit from having standard e-commerce insurance policies in place.
When taking out e-commerce insurance, it’s important to consider different types of coverage and policies to adequately cover your business for liabilities.
The most common types of coverage for e-commerce businesses are:
Unexpected events can happen and general liability insurance can protect your e-commerce business against basic risk factors. For instance, a delivery driver could fall over while collecting packages or claims could be made against your business for copyright infringement. Plus, platforms such as Amazon can require a general liability insurance policy to be in place before you can start selling.
Coverage for general liability insurance can include third-party property damage, personal and advertising injury, medical costs, reputational harm, settlement, and legal defense costs.
Exclusions for general liability insurance can include employee injuries and illnesses, commercial auto accidents, tools, and equipment.
As an online store, your business could come under attack from hackers trying to steal proprietary information and customer data. If, for example, customer credit card information is compromised, cyber liability insurance can help cover the cost of informing customers and investigating the breach. This could help save the public reputation of your business and retain customer loyalty.
Cyber liability insurance for e-commerce businesses can include coverage for data breaches, cyberattacks, phishing, and incidents that cause business disruption.
Exclusions for cyber liability insurance can include patent, software, and copyright infringement. In addition, if an insurer finds that a lack of security measures had not been put in place to safeguard customer information, claims could be rejected.
A product you sell could be defective in the way it was manufactured, designed, or sold. You may need to recall one of your products or pay for medical expenses if the product causes personal injury to a consumer. Product liability insurance can help cover legal fees, damages, and medical costs.
Many insurers include coverage for product liability as part of the general liability insurance policy while other insurers may require you to purchase a separate policy.
Common exclusions for product liability insurance include employee injuries, accidents on business property, lost inventory, and professional negligence.
In many states, it is a requirement to have workers’ compensation insurance in place to provide employee benefits in case of workplace accidents and injuries. An employee could injure their back while lifting boxes in a warehouse or suffer from neck pain due to working on a computer.
Workers’ compensation insurance coverage can protect your e-commerce business and employees for medical expenses, lost wages, employer liability, legal costs, retraining, permanent injury, and survivor benefits.
Exclusions can include pre-existing medical conditions for employees, and coverage for executive officers and owners of the business.
When you make a sale, both your e-commerce business and the buyer are bound by the terms and conditions agreed during the transaction. If your business breaches its contract or fails to meet delivery expectations resulting in a financial loss for the customer, you could be held liable for damages.
Professional liability insurance coverage can protect you against professional mistakes, accusations of negligence, legal defense costs, breach of contract, and missed deadlines.
Exclusions for professional liability insurance can include workplace accidents, intentional wrongdoing, and illegal activity.
When you take out an e-commerce insurance policy, the limits will determine the maximum amount you can claim during a policy period. Limits will differ depending on the type of insurance policy you take out and your business revenue. Some insurers can start with limits of $500,000 going up to $1 million for general liability insurance.
Certain insurance policies will have a per-occurrence limit and others will have an aggregate limit. Policies with a per-occurrence limit cover you for a maximum amount per claim. An aggregate limit covers you for a maximum amount per policy period no matter how many claims you file.
Several factors go into the calculation of e-commerce insurance, and policy premiums can vary between insurers. On average e-commerce businesses can expect to pay $45 per month for general liability insurance and $140 per month for cyber liability insurance.
Here are some factors that insurers will consider when providing a quote:
When looking for the best e-commerce insurance policy, here are some key factors to consider before you make a purchase: